Full text of H.16 Capital Market Developments : December 11, 1972
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DECONTROLLED AFTER SIX MONTHS CAPITAL MARKET DEVELOPMENTS Capital Markets Section, Division of Research and Statistics, Board of Governors of the Federal Reserve System, Washington, D. C. INDEX Developments in the Corporate and Municipal Bond Markets Capital Market Y i e l d s Capital Market Volume Stock Market Mortgage Market SYMBOLS: e Estimate p Preliminary r Revised n.a. Not available 3 T A B L E 1: Yields, Volume and Reception WEEK ENDING: 1972 - Nov. 3 10 17 24 Dec. 1 8 15 WEEK ENDING: 1972 - Nov. 3 10 17 24 Dec. 1 8 15 YIELDS MOODY'S UEW ISSUE SEASONED Aaa i Aaa UTILITY 7.18 7.28 -7.16 7.12 7.12 6.99 7.09 7.07 7.05 7.05 7.15p n. a. YIELDS BOND BUYER MOODY'S SEASONED 20 NEW ISSUE BOND INDEX Aaa 5.04 4.90 5.10 5.00 5.01 4.90 4.96 4.85 4.90 4.85 n.a. 4.99 4.96 n.a. CORPORATE BOND MARKET VOLUME 2 PER CENT GROSS SOLD BY END BONDS SCHEDULED OFFERINGS OF WEEK WITHIN 28 DAYS 120 100 75 125 79 170 n.a. 366 74 622 340 43 Oe 76 75 MUNICIPAL BOND MARKET VOLUME 2 PER CENT SOLD BY END GROSS OF WEEK OFFERINGS 340 , 331 457 352 71 39 85 84 407 881 573e 58 76 n.a. n.a. BONDS SCHEDULED WITHIN 28 DAYS 654 1,548 1,431 1,279 1,203 569 1 New series derived by adjusting to a Aaa utility basis, new issues of publicly-offered corporate bonds with call protection, rated A, Aa, or Aaa by Moody's Investors Service (except serial and convertible issues, offerings of natural gas pipeline and foreign companies, and bonds guaranteed by the Federal Government). For additional details and back data, see the September 1972 issue of the Federal Reserve Bulletin. The Aaa corporate yield series previously published in the L.5.8. has been discontinued. 2 Millions of dollars unless otherwise indicated. NOTE: see footnotes to Table 3. T A B L E 2: Details on Inventories DATE OFFERED j | AMOUNT (MIL. $) Duke Power Arkansas Pwr & Lt. Cameron Fin United Tele of Fla. 75.0 15.0 40.0 15.0 12/5 12/6 12/7 12/7 OFFERED CORPORATE BONDS IN SYNDICATE END OF LATEST WEEK ORIGINAL RATING AND YIELD CALL PROTECTION ISSUER COUPON DATE | RELE\SED 11/14 11/28 11/28 11/30 12/4 12/6 12/7 12/6 12/6 12/6 7 7 7 7 3/8 1/2 1/2 1/2 7.33 7.40 7.55 7. 43 As A 5 5 10 5 -- A 25% 40% 90% 30% yrs yrs yrs yrs CORPORATE BONDS RELEASED FROM SYNDICATE DURING LATEST WEEK ORIGINAL INCREASE RATING AND ESTIMATED PROISSUER COUPON IN YIELD CALL PROT. PORTION RELEASED YIELD AMOUNT Fla Pwr Appalachain Pwr Potomac Edison AT&T Kentucky Utilities 50.0 70.0 12.0 150.0 35.5 DATE 19^2 - Nov. - 10 17 24 Dec. - ..j.V ESTIMATED PROPORTION SOLD 1 8 INVENTORIES 1 MUNICIPALS BLUE LIST | IN SYNDICATE l,290r 254 924r 126 954r 136 964r 977 249 322 7' 1' 7 6 7 1/4 1/2 1/2 1/2 3/8 7.17 7.38 7.40 6.43 7.23 +7 +8 4-8 +5 +10 Aa A A Aaa Aa 5 5 5 5 5 yrs yrs yrs yrs yrs 40% 75% 60% 25% 75% . CORPORATES IN SYNDICATE 31 36 121 149 85 N.C. - No call protection. 1 All figures in millions of dollars. Blue List is daily average for veck ended Friday,except for latest \:i-ek vhich i? daily average of three days ended Wednesday. All other figures arc as of Friday. T A B L E 3: High Grade Bond Yields U.S. GOVERNMENT 20-YEAR CONSTANT MATURITIES 3 7.55 (5/29) 6.17 (12/18) BOND BUYER'S SEASONED MUNICIPALS 4 7.12 (5/29) 5.33 (12/11) 1970 - High Low NEW ISSUE Aaa UTILITY 9.43 (6/19) 7.72 (12/11) MOODY'S SEASONED CORPORATE Aaa2 8.60 (7/3) 7.48 (12/21) 1971 - High Low 8.26 (7/30) 7.02 (2/5) 7.71 (8/13) 7.06 (2/12) 6.51 (6/18) 5.69 (3/23) 6.23 (6/23) 4.97 (10/21) 1972 - High Low 7.60 (4/21) 6.99 (11/24) 7.36 (4/28) 7.05 (12/8) 6.19 (4/14) 5.74 (11/17) 5.54 (4/13) 4.96 (12/7) 7.28 7.18 7.16 7.12 7.09 5.89 5.80 5.74 5.76 5.04 5.10 5.01 4.96 DATE 1972 - Nov. 3 10 17 24 7.12 6.99 4.99 5.82 7.07 7.05 1 5.87 4.96 8 7.15p 7.05 New corporate issues, with call protection, adjusted (as described in 1 footnote 1 of Table 1) to a Aaa basis. 2 Weekly average of daily figures. Average term of bonds included is 22-24 years. 3 Weekly average of daily figures. 4 Thursday figures. The average rating of the 20 bonds used in this index falls midway between the four top groups as classified by Moody's Investors Service. Note--Highs and lows are for individual series and may be on different dates for different series. Dec. I T A B L E 4: Long-term Corporate and State and Local Government Security Offerings and Placements (In millions of dollars) GROSS PROCEEDS CORPORATE PERIOD 1 STATE AND LOCAL 2 1972 1971 1970 1972 1971 January February March 3,205 3,369 3,229 3 ,115 3 ,000 6 ,075 2 ,636 1 ,802 3 ,539 1,776 2,002 2,237 2 ,732 1 ,851 2 ,258 1,340 1,214 1,555 April Hay 3,275 3,598 4,341 4 ,042 3 ,300 4 ,375 3 ,170 3 ,909 3 ,389 1,988 2,002 2,260 1 ,891 2 ,167 . 2 ,013 1,647 996 1,085 July August September 3,582 3,013 2,750 4 ,147 2 ,532 3 ,768 2 ,768 2 ,274 3 ,518 1,800 1,951 1,693 1 ,989 1 ,903 2 ,098 1,348 1,359 1,758 October November December 3,500e 3,050e 3 ,387 3 ,704 3,,673 3.,777 4;,182 3.,980 l,850e l,800e 1 ,728 2;,264 2,068 1,924 1,748 2,190 9,803 11,214 9,345 12:,190 11,,688 io:,447 10,,764 7.,977 10,,468 8,,560 11,,939 6,015 6,250 5,444 6,,841 6,,081 5,,990 6,,060 4,109 3,7Z8 4,465 5,862 21,017 30,362 23,,844 34,325 45,089 18,445 27,005 38,944 12,265 17, 709 12,912 18,902 24,962 7,837 12,302 18,164 1st 2nd 3rd 4th Quarter Quarter Quarter Quarter 1st half Three quarters Year j | ; 1 ! 1 1970 Securities and Exchange Commission estimates of gross proceeds* Investment Bankers Association of America estimates of principal amounts. TABLE 5: New Corporate Security Issues, Type of Issue and Issuer (In millions of dollars) QUARTER OR MONTH 1971 IV TOTAL 161447 10,764 GROSS PROCEEDS BY GROSS PROCEEDS BY TYPE OF ISSUER TYPE OF ISSUE COMMON COMMUNIMEMO: AND PUBLIC BONDS PUBLICLY PRIVATELY PFD. ISSUES INCLUDED MFG. UTILITY CATIONS PLACED FOREIGN | STOCK CONVERTIBLE OFFERED 2.,263 2,202 2,651 652 1 641 4,079 114 4,725 1 ,053 2;,543 3,041 2 439 3,193 133 767 5,135 OTHER ISSUERS 1 3,331 4,164 9,805 11,214 9,345 5,361 4,634 4,192 1 ,593 2 ,781 1 ,893 2,851 3,798 3,259 74 245 68 511 449 839 1 ,525 2 ,109 1 ,749 2,261 3,495 2,701 1 ,476 1 ,369 856 4,541 4,240 4,038 1971 - Oct. Nov. Dec. 3,387 3,704 3,673 1,942 2,003 1,19,0 723 433 1 ,283 723 1,269 1,201 59 . 62 12 222 395 150 662 811 980 933 1,217 891 432 269 352 1,360 1,408 1,450 1972 - Jan. Feb. Mar. 3,205 3,369 3,229 1,767 1,907 1,677 604 412 577 834 1,041 976 59 12 3 195 83 233 392 529 604 533 988 740 752 498 227 1,529 1,354 1,658 581 1,219 864 1,622 789 15 92 3,275 Apr. 761 738 1,148 100 226 1,676 774 3,598 May 1,786 130 767 1,538 1,336 1 ,218 131 4,341 June 798 574 657 1,118 3 450 1,807 3,582 July 635 559 431 1,058 13 1,523 183 3,013 Aug. 616 1,268 1,083 805 52 862 205 2,750 Sept. 350 1,200 n.a. 650 1,200 150 1,650 3,500 Oct.e/ 885 125 650 1,050 n.a. 1,350 150 3,050 Nov.e/ Other issuers are extractive, railroad and other transportation, real estate and finance, and commercial and other. Source: Securities and Exchange Commission. Quarterly supplements are available. 178 391 800 586 237 33 360 760 1,297 1,708 1,235 1,624 1,581 833 1,590 1,280 1972 - I II HI 1 TABLE 6: Large Long-term Public Security Issues for New Capital (continued) (Other than U.S. Treasury) 1 Dec. 4 through Dec. 8, 1972 ISSUER Kentucky Utilities Guardian Mtge Investors Duke Pwr Cameron Financial Corp General Public Utilities Co San Diego Gas & Elect Centennial Corp Firnt Va. Bankshares Corp Arkansas Pwr & Lt. Arkansas Pwr & Lt. Tampa Elect Pacific Gas & Elect United Tele of Fla. National Rural Util Coop Fin Talley Industries AMOUNT (MILLIONS OF DOLLARS) 1st mtge 35.0 25.0 Notes 75.0 1st mtge 40.0 Debs 34.3 Com. 30.8 Com stk Conv debs 25,0 / 25.0 Notes 15.0 Bonds Pref stk 20.2 18.8 Com stk Pref stk 55.8 1st mtge 15.0 Coll trust 50.0 Debs 25.0 TYPE 2 MATURITY 2002 1979 2002 2002 -- 1992 1982 2002 -- COUPON RATE OR NET INTEREST COST 7 7 7 7 3/8 1/2 3/8 1/2 | > »>FFKR j | 1 YIELD. 7.23 7.55 7.33 7.55 -- -- -- -- 4.00 7.00 7 1/2 7.40- 4.00 7.00 7.40 7.38 -w -- -— —- 2002 2007 1997 7 1/2 7 1/2 •8 1.8 8.00 7.43 7.43 7.17 — MOODY'S RATING Aa — Aa --- • . -— — A -—— A A Baa J- TABLE 6: Large Long-term Public Security Issues for New Capital (continued) (Other than U.S. Treasury) 1 ISSUER State and Local Atlanta, Georgia Atlanta, Georgia *Mass St. Coll. Bldg. Auth Prince Georges Co., Md. New York City Piano ISD, Texas University, Texas H.A.A. Beaver Co. Ind. Dev. Auth., Pa. TYPE 2 AMOUNT (MILLIONS OF DOLLARS) 8.8 30.3 33.1 32.5 294.0 .10.0 17.0 268.2 Rev-ref Rev-ref Rev. G.O. G.O. G.O. Rev. Bonds Pol. Cont. 22.5 Rev. Los Angeles Parking Auth, Calif .Rev.-ref . 26.9 • J Decemheif 6 throuph December COUPON | RATE OR • MTKK- MOODY'S NET INTER- ' r;, ( RATING EST COST | YIl-.l.l) -3.50-5.00 Baa Baa 5.64 -2.90-5.25 Aa 3.10-5.40 A 3.50-6.00 Baa-1 4.98 3.50-5.50 Baa-1 4.94 | MATURITY 1974-1983 2000 1973-2013 1974-1998 1974-2013 1975-1998 -- -- 4.88 2.50-5.00 Aaa 1997 1973-1992 -- 5.60 4.40-5.05 -- 1 Rights offering. Includes corporate and other security offerings of $15 million and over; State and local security offerings of $10 million and over. In case of State and local government securities, G.O. denotes g e m raI obligation; Kev.-Ut., revenue obligations secured only by income from public utilities; Rev.-Q.-lit., revenue bonds secured only by income from quasi -utilities; Rev.-S.'l'., revenue bonds secured by revenue from specific taxes only; Rev.-Rent., revenue bonds secured solely by lease payments. Includes foreign government and International Bank for Reconstruction and Development issues and non-quaranteed issues by Federal Agencies. -- 1973-2013 16 T A B L E 7: Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U.S. Treasury) 1 (continued) ISSUER BankAmerica Georgia Pwr *Gananda Devel Corp Union Electric Avco Finanical Duquesne Light Duquesne Light McCulloch Prop Credit Sedco Maritime Inc First Amtenn Corp First Nat'1 Boston Borg Warner Acceptance Corp Continental Illinois Realty *Public Svc of Indiana *Penn Pwr & Lt jfrFla Pwr & Lt (^Central Pwr & Lt ^Montana Pwr *Okla Gas & Elect Maine Yankee Atomic | Maine Yankee Atomic ' Continenta Illinois Corp Zapata Exploration Co. TYPE Bonds Bonds Debs Pref Bonds . Bonds Cm Bonds Bonds Bonds Bonds Bonds Bonds Pref Bonds Bonds Pref Bond s Cm (rts) Bonds Pref Notes Conv deb AMOUNT (MILLIONS OF DOLLARS) 100.0 150.0 22.0 55.0 50.0 40.0 35.0 30.0 75.0 25.0 100.0 25.0 25.0 35.0 80.0 70.0 26.0 25.0 45.0 15.0 15.0 100.0 25.0 1972 APPROXIMATE DATE OF OFFERING December December December December December December December December December December December December December January January January January January January January January January INDEF 12 12 12 13 13 14 14 15 19 19 20 20 20 4 8 9 10 10 10 11 11 11 T A B L E 7: Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U.S. Treasury) 1 ISSUER i State and Local Maricopa Co., Ariz New York St. Dormitory Auth *New Jersey Penna Higher Ed. Fac. Auth. Los Angeles DWAP Richmond, Va. *Erie Co. Hosp Auth, Pa. Rochester, New York New Jersey Finance Agency Newark, N.Y. *Puerto Rico Oklahoma Cap. Imp. Auth Dallas, Texas Hartford, Conn. Atlanta, Ga. Monroe Co. Mich Garland, Texas Hampton Rds. Sanitation Dist Va. Los Angeles Dept of Wtr & Pwr. TYPE AMOUNT (MILLIONS OF DOLLARS) APPROXIMATE DATE OF OFFERING G.O. 15.0 Rev. 32.8 G.O. 75.0 G.O. 14.4 Rev. 116.2 G.O. 38.0 Rev. 42.9 Swr Rev. 15.8 Rev. 49.0 20.0 G.O. 50.0 G.O. Rev. 13.5 28.5 G.O. 25.0 G.O. Airport-rev 38.5 Pol contr-rev 57.0 Rev. 10.5 Dec. Dec. Dec. Dec. Dec. Dec. Dec. Dec. Dec. Dec. Dec. Dec. Dec. Dec. Dec. Dec. Jan. 16 Swr rev Elec rev 25.0 50.0 Feb. Feb. 1 77 100.0 Jan. 16 11 12 12 12 13 13 13 14 14 19 20 28 Other G.O. *T.V.A. * 1 2 Included in table for first time. Includes corporate and other issues of $15 million and over; State and local Government issues of $10 million and over. Includes foreign government and International Bank for Reconstruction and Development issues and non-guaranteed issues of Federal Agencies. 12 Table 8 STOCK PRICES AND VOLUME STOCK PRICES 1 ' TRADING VOLUME 2 - DATE NYSE INDEX 3 - D J . INDUSTRIALS AMEX * NYSE AMEX 1970 - High Low 52.36 (1/5) 37.69 (5/26) 842.00(12/29) -27.02 (1/8) 631.16 (5/26) 19.36 (5/27) 18.5 (12/4) 7.8 (8/14) 7.1 (1/2) 1.8 (8/14) 1971 - High Low 57.76 (4/28) 48.73 (1/4) 950.82 (4/28) 26.68 (4/28) 797.97(11/23) 22.72 (1/4) 22.1 (2/12) 11.0 (9/17) 6.7 (2/5) 2.7 (8/13) 1972 - High Low 65.01 (12/8) 1033.26 (12/7),28.53 (4/14) 56.23 (1/3) 889.30 (1/3) 25.61 (1/3) 21.8 (11/10) 11.2 (9/8) 7.4 (3/10) 2.6 (9/8) 1972 - Oct. 6 13 20 27 60.03 59.10 59.77 60.60 945.36 930.46 942.81 946.42 25.95 25.80 25.72 25.89 15.3 11.8 14.2 16.6 3.1 2.6 2.9 3.3 Nov, 3 10 17 24 62.52 62.33 63.25 64.12 984.12 995.26 L005.57 1025.21 26.14 26.14 26.15 26.32 18.4 21.8 20.1 19.8 4.0 4.3 4.2 4.2 Dec. 1 8 64.29 65.01 1023.93 1033.19 26.61 26.78 19.3 J 18.7 4.8 4.9 NOTES: 1. Figures other than highs and lows are Fridays only. Highs and lows are for the year and are not necessarily for Fridays. 2. NYSE is the New York Stock Exchange; AMEX is the American Stock Exchange. Volume figures are daily averaged for the entire week, (millions of shares). Trading is normally conducted for 5-1/2 hours per day and 5 days per week, or 27-1/2 hours per week. In recent years, however abbreviated trading to the extent, and over the time periods, shown below: Hours/ Through: From Day Week Week January 3, 1969. July 7, 1969 January 2, 1970 July 3, 1969 December 31, 1969 May 1, 1970 3. 12/31/65 = 50 4. Average dollar value of shares listed. -4 4-1/2 5 5 20 22-1/2 25 13 T A B L E 9: Security Credit END OF PERIOD CREDIT EXTENDED TO MARGIN CUSTOMERS BY: BROKERS 1 | BANKS 2 | TOTAL CUSTOMERS' NET DEBIT BALANCES NET CREDIT CUSTOMERS' NET EXTENDED BY BROKERS AND FREE CREDIT DEALERS 3 BALANCES Outstanding: 1971 - July Aug. Sept. Oct. Nov. Dec. 4,790 4,850 4,930 4,950 4,910 5,400 2,420 2,430 2,430 2,410 2,400 2,440 7,210 7,280 7,360 7,360 7,310 7,840 1972 - Jan. Feb. Mar. Apr. May June July 5,700 6,180 6,620 7,010 7,200 7,510 7,660 2,490 2,510 2,520 2,530 2,560 2,650 2,700 8,190 8,690 9,140 9,540 9,760 10,160 10,360 1972 - July Aug. Sept. Oct. Nov. Dec. 70 60 80 20 -40 490 30 10 100 70 80 -20 -10 40 -50 530 -- 1972 - Jan. Feb. Mar. Apr. May June July 300 480 440 390 190 310 150 50 20 10 10 30 90 50 350 500 450 400 220 400 200 — (4) (4) (4) (4) (4) (4) (4) (4) (4) (4) (4) (4) (4) 2,210 2,200 2,100 2,160 2,170 2,220 2,488 2,542 2,512 2,459 2,330 2,231 2,245 (4) (4) (4) (4; (4) (4) ' (4) (4) (4) (4) (4) (4) (4) Change inOutstanding-: 1 2 3 4 — —— -— — - -- — 230 -10 100 60 10 50 268 54 -30 -53 -129 -99 14 —— -— — -— -— — — -- Margin debt, as reported by the New York Stock Exchange. Although margin debt until March 1968 included loans secured by U.S. governments, the amount of such loans included is thought to have been small. "Bank loans to others than brokers and dealers for purchasing or carrying securities other than U.S. governments." The difference between customers' net debit balances and customers' net free credit balances, this figure represents the net credit extended by brokers and dealers to the nonfinancial public. NOTE: With the exception of bank loan data, figures are supplied by the New York Stock Exchange and are end of month data. Bank loans are for weekly reporting large commercial banks. Broker data includes loans for regulated securities; bank data includes loans for the purpose of purchasing or carrying any security, whether regulated or not. Series discontinued / T A B L E 10: Savings Flows at Nonbank Depositary Intermediaries DATE 1969 1970 1971 2,549 4,517 9,623 1971 - August September October 1972 - August E/ September October e/ 1972 - April May June July Augus t September g/ October e/ \ 4.0 6.8 13.5 300 793 382 -- 418 1,025 475 -* 820 576 937 798 665 917 704 -—— 11.7 8.2 13.2 11.1 9.2 12.6 9.5 -763 936 5,678 SAVINGS ) SHARE CAPITAL ANNUAL GROWTH NET FLOW RATE 1 £ MUTUAL SAVINGS BANKS NET REGULAR DEPOSITS 3 NEW ANNUAL 2 MONEY GROWTH NET RATE 1 FLOW i Ii ($ millions) Not Seasonally Adjusted 4,068 3.1 -1,003 10,965 8.1 5,285 28,244 19.4 20,652 195 105 224 1,538 2,670 1,600 310 223 n.a. 1,801 3,395 2,054 ----- NET NEW MONEY 2 2,704 1,814 2,849 3,432 2,232 2,832 2,538 -__ — 17.6 11.7 18.2 21.5 13.7 17.3 15.2 TOTAL DEPOSITS ANNUAL NET GROWTH RATE 1 FLOW 6,617 15,482 37,867 3.4 7.7 17.5 NET NEW MONEY 2 -1,766 6,231 26,330 1,052 1,091 1,504 1,409 3,463 1,982 1,247 1,196 1,728 1,708 1,494 n.a. 2,219 4,420 2,529 2,018 1,717 n.a. -—— —— —— 3,524 15.8 2,390 3,786 4,230 2,897 3,759 3,242 10.5 16.6 18.3 12.3 15.8 13.5 Annual growth rate for monthly data is the annualized monthly percentage increase in deposits. Net New Money is new deposits net of both withdrawals and interest. Data for S&Ls are foxinsured associations only, which represent 96% of industry total resources. Regular deposits at mutual savings banks exclude items such as Christmas club and certain escrow accounts, which represent a very small part of total deposits. SOURCE: National Association of Mutual Savings Banks and Federal Home Loan Bank Board. —— -—— --- T A B L E 11: Mortgage Commitments at Selected Thrift Institutions DATE TOTAL OUTSTANDING COMMITMENTS | ALL MUTUAL | SAVINGS SAVINGS & TOTAL BANKS LOAN (N.Y. STATE) ASSOCIATIONS 1 NET CHANGE ALL SAVINGS & LOAN ASSOCIATIONS MUTUAL SAVINGS BANKS (N.Y. STATE) (Billions of Dollars, Sea sonally Adjusted) Sept. Oct. Nov. Dec. 16.4 16.3 16.6 16.6 13.2 13.1 -13.2 13.1 •72 .- Jan. Feb. Mar. Apr. May 17.0 18.3 19.5 20.5 21.7 21.7 22.0 22.7 23.3 23.4 13.3 14.2 15.2 16.0 17.1 17.2 17.5 18.0 18.3 18.4 July lug. Sept. r/ Oct. £/ l 3.2 3.3 3.4 3.6 .07 .02 .20 .09 -.07 -.05 .08 -.06 . 14 .07 .12 . 15 3.7 4.1 4.3 4.5 4.6 4.5 4.5 4.7 5.0 5.0 .30 1.34 1.19 .99 1.22 .40 .33 .67 .59 .11 .12 .97 .97 .79 1.13 .48 .39 .42 .33 .14 .18 .37 .22 .20 .09 -.08 -.06 .25 .26 -.03 Based on data from Federal Home Loan Bank Board and Savings Banks Associations of New York State. Data for savings banks and S&L's include a minor amount of nonresidential commitments. S&L commitments include loans in process. Net changes are derived directly from unrounded outstandings levels as reported and after seasonal adjustment by Federal Reserve. Subtotals may not add to totals because of rounding. T A B L E 12: Net Change in Mortgage Holdings DATE TOTAL INCLUDING FNMA-GNMA TOTAL 1 FINANCIAL INSTITUTIONS LIFE MUTUAL SAVINGS &| INSURANCE COMMERCIAL SAVINGS LOAN COMPANIES BANKS BANKS ASSOC. FT.'MA-GNMA Not Seasonally Adlusted 1968 1969 1970 1971 23,781 24,074 21,736 41,647 1972 - May June July Aug. Sept. 4,958' 5,724 4,872 5,931 n.a. 21 ,273 19 ,699 16 ,827 39 ,259 6,677 5,404 2,462 9,940 4 ,674 5 ,692 4 ,717 5 ,563 n.a. 1,500 1,600 1,500 1,600 1,400 2,787 2,682 1,845 3,938 454 585 380 553 n.a. 9,350 9,561 10,172 24,160 2,459 2,052 2,348 1,221 2,508 4,375 4,909 2,388 2,720 3,453 2,758 3,313 2,888 24 54 79 97 90 284 50 155 368 370 Seasonally Adlusted 1971 - Aug. Sept.r/ Oct. Nov. Dec. 4,270 4,007 3,747 3,745 4,323 1972 - Jan. Feb. Mar. Apr. May 3,323 3,715 4,408 4,357 4,914 5,324 4,780 5,645 n.a. July Aug. Sept. 1 3,,357 3,,443 4,,081 1,001 999 974 843 824 400 306 329 465 522 2,252 2,122 1,977 2,058 2,357 105 114 77 77 378 512 466 390 302 242 3, 174 3,465 4, 297 4, 358 4, 539 5, 205 4, 636 5, 292 n.a. 1,088 1,154 1,261 1,384 1,461 1,514 1,477 1,501 1,202 272 296 486 390 455 533 365 537 n.a. 1,813 2,042 2,571 2,506 2,571 3,067 2,693 3,174 2,889 1 -27 -21 78 52 91 101 80 126 149 250 111 -1 375 119 144 353 326 3.,758 3,,541 Monthly data for commercial banks based on Federal Reserve estimates benchmarked to Call Report data on real estate loans outstanding as available. Other data derived from mortgage debt outstanding as reported separately by National Assn. of Mutual Savings Banks, Federal Home Loan Bank Board, Institute of Life Insurance and, through August 1968, the Federal National Mortgage Association, and thereafter by FNMA and the Government National Mortgage Association. Data for mutual savings banks and for Life Insurance companies may differ somewhat from those derived from regular quarterly series because of minor conceptual differences fur which adjustments are not made in the monthly series. Altogether, these groups accounted for 87 per cent of the net increase estimated for all holders in 1971. 17 TABLE 13: Net Increases in Mortgage Debt Outstanding Billions of dollars, SAAR TOTAL RESIDENTIAL 3 1- to 4FAMILY 1967 - I II III IV 16.0 20.8 26.3 27.2 10.3 14.0 18.9 19.7 7.0 10.6 15.1 15.9 3.3 3.4 3.8 3.8 3.9 5.0 4.9 4.7 7.2 8.4 8.8 8.5 1.8 1.8 2.5 2.8 1968 - I II III IV 28.1 26.4 25.8 29.4 19.4 18.2 17.4 20.2 16.2 15.0 13.9 16.3 3.2 3.2 3.5 3.9 6.4 6.0 6. 6 7.3 9.5 9.2 10.1 11.2 z-27 3 2.2 1 8 1.9 1969 - I II III IV 31.8 29.1 26.2 24.9 23.6 21.5 19.0 1,8.2 19.2 16.8 14.4 13.0 4.4 4.7 4.7 5.3 6.1 5.4 5.4 5.2 10.5 10.1 10.0 10.5 2.2 2.2 1. 7 1.4 1970 - I II III IV 20.6 22.9 ?9.1 31.3 14.2 16.9 21.8 22.5 9.1 11.5 15.5 16.0 5.1 5.4 6.3 6.5 4.8 4.6 5.2 6.7 9.9 9.9 11.5 13.2 1.5 1.5 2.1 2.2 1971 - I II III IV 37.1 47.8 53.6 53.4 26.6 36.1 40.1 40.1 18.5 26.4 31.4 31.4 8.1 9.7 8.7 8.7 8.3 9.4 11.2 10.8 16.3 19.1 19.9 19.5 2.2 2.3 2.3 2.5 1972 - I II Ille 61.2 64.9 66.2 43.9 47.3 48.4 34.3 37.4 38.0 9.6 9.9 10.4 14.8 14.9 14.9 24.4 24.8 25.3 2.6 2.6 2.9 QUARTER MULTIFAMILY COMMERCIAL . MULTI-AND COMMERCIAL j , FARM farm mortgage debt by type of property, where not available, and interpolation. Residential mortgage debt includes nonfarm only and is sum of 1-to 4- family and multifamily mortgage debt combined. TABLE 14: FNMA Weekly "Auction" Results WEEK ENDED IMPLICIT YIELD 2 (per cent) COMMITMENTS IN $ MILLIONS ACCEPTED 1-YEARtl 1-YEAR 1 9090TOTAL 6TOTAL 6& OVER OFFERED MONTH & OVER DAY M0NTH DAY July 10 24 134.6 123.9 92.1 113.0 92.1 113.0 -- -- 7 • 62 7.62 --— -— -- Aug. 7 21 106.2 114.6 81.7 87.2 81.7 87.2 -- -- 7.63 7.62 -— -- -— Sept. 5 18 220.6 295.9 151.2 148.1 151.2 148.1 -- 7.63 7.65 --- -— -— Oct. 2 16 30 r/ 352.8 271.2 186.4 211.5 224.9 162.7 211.5 224.9 162.7 7.69 7.72 7.72 --— — — — Nov. 13 r/ 27 £/ 78.7 60.8 49.2 36.2 49.2 36.2 7.71 7.69 — — -- -- -- -- Note: Under the FNMA auction system, approved sellers of Governmentunderwritten mortgages bid for FNMA forward purchase commitments. Average secondary market yields after allowance for commitment fee and required purchase and holding of FNMA stock, assuming prepayment of 15 years for 30-year Government-underwritten mortgages. Yields shown are gross, before deduction of 38 basis points fee paid by investors to servicers. 19 T A B L E 15: Priv a t e Housing Starts and Permits STARTS DATE 1971 - October November December SEASONALLY ADJUSTED ANNUAL RATE TOTAL -FAMILY 2 OR MORE TOTAL UNADJUSTED TYPE OF FINAHCINfi FHA I VA T OTHER 2,038 2,228 2,457 1,155 1,242 1,347 882 985 1,110 179.7 176.4 152.1 38.5 47.2 85.4 1972 - January 2,487 February 2,682 March 2,369 April 2,109 May 2,350 June 2,330 July r/ 2,218 August r/ 2,484 September p/| 2,366 October 2,410 1,415 1,325 1,302 1,167 1,344 1,296 1,289 1,410 1,371 1,071 1,357 1,067 942 1,006 1,034 929 1,074 1,613 1,122 150.9 153.6 205.8 213.2 227.9 226.3 205.0 228.2 37.4 27.8 37.7 29.1 32.4 31.9 26.2 30.3 29.3 1,288 200.8 8.1 9.1 7.4 7.5 8.0 BUILDING PERMITS (SEASONALLY ADJUSTED ANNUAL RATE)2 133.1 120.1 59.3 1,983 2.051 2,142 106.0 2,204 2,056 2,007 1,991 1,955 2,121 117.8 155.7 172.9 186.1 184.8 171.9 10.5 8.5 9.4 9.6 9.4 9.8 188. 0 8.9 162.6 2,108 2,237 2,265 2,218 Total starts are Census estimates including farm for both permit-issuing and noi.-issuing areas. A dwelling unit is started when excavation begins; all units in an apartment structure are considered started at that time. FHA and VA starts are units started under commitments by these agencies to insure or guarantee the mortgages. As reported by FHA and VA, a unit is started when a field office receives the first compliance inspection report, which is made before footings are poured in some cases but normally after the foundations have been completed. Other starts are derived as a residual, although total and FHA and VA starts are not strictly comparable in concept or timing; other starts include both units financed by conventional mortgages and units without mortgages. Building permits are Census estimates based on 13,000, or all known permitissuing places. Unlike starts, seasonally adjusted building permits reflect direct adjustment for differences in the number of days per month, as well as other differences in timing and coverage. TABLE 16: Mortgage and Bond Yields FHA MORTGAGES DATE 30-year 2 1 C0NVEN1 TIONAL MORTGAGES 3 SPREAD BETWEEN YIELDS ON CONV. & FHA MORTGAGES 5 NEW ISSUE Aaa UTILITY 4 SPREAD BETWEEN YIELDS ON NEW CORPORATE BONDS AND FHA MORTGAGES 6 - High Low 9.29 8.40 8.60 8.30 -.10 -.74 9.43 7.72 .37 .70 - High Low 7.97 7.32 7.95 7.55 .28 -.19 8.26 7.02 .52 -.36 - Nov. Dec. 7.62 7.59 7.75 7.70 .13 .11 7.38 7.28 .24 .31 - Jan. Feb. Mar. Apr. May June July August September 7.49 7.46 7.45 7.50 7.53 7.54 7.54 7.55 7.56 7.60 7.60 7.55 7.60 7.60 7.60 7.65 7.65 7.70 .11 . 14 . 10 .10 .07 .06 .11 . 10 .14 7.21 7.34 7.24 7.45 7.38 7.32 7.38 7.37 7.40 .28 .12 .21 .05 .15 .22 .16 .18 .16 October 7.57 7.70 .13 7.38 .19 Neither mortgage nor bond yields include allowance for servicing costs which are much higher for mortgages than for bonds. Generally, bonds pay interest semiannually; mortgages, monthly. Mortgage yields, if computed as equivalent to a semi-annual interest investment, would be slightly higher than given in the table. , 2 Based on FHA-field-office opinions about average bid prices in the private secondary market for new-home mortgages for immediate delivery. Separate data available for 25-year and—beginning July 1961--30-year mortgages with minimum downpayments, weighted by probable volume of transactions. Yields . computed by FHA, assuming prepayment period of 12 years for 25-year mortgages and 15 years for 30-year mortgages. 3_ Based on FHA-fieId-office opinion on typical contract interest rates (rounded) on conventional first mortgages prevailing in the market areas of insuring offices. 4 See note for Table 1. 5 Yield spread equals conventional mortgage rate less FHA secondary market yield. 6 Yield spread equals FHA secondary market yield less new Aaa corporate bond yield. 1 21. TABLE 17: Conventional Mortgage Terms 1 NEW HOMES CON- FEES & CHARGES EFFECMATURITY TRACT (PER (YEARS) RATE TIVE CENT) RATE (PER CENT) 3 2 LOAN/ PRICE RATIO (PER CENT) LOAN AMI. ($000) EXISTING HOMES CON- FEES & LOAN / TRACT CHARGES EFFEC- MATU- PR1CF. LOAN (PER RATE TIVE RITY RATIO ' AMI. CENT) RATE (YEARS) (PER ($000) (PER CENT) CENT) 2 3 1971 7.51 7.60 7.67 7.68 7.65 7.62 0.90 0.84 0.97 0.97 0.87 0.93 7.66 7.74 7.83 7.84 7.79 7.77 26.3 26.2 25.8 26.4 26.7 26.6 74.5 73.9 75.3 75.5 75.4 74.5 27.1 26.5 25.9 26.3 27.3 26.5 7.50 7.58 7.63 7.62 7.56 7.51 7.62 7.45 7.38 7.38 7.40 7.41 7.43 July 7.45 Aug. Sept.r/ 7.43 Oct. j)/ 7.48 0.95 1.02 0.84 0.83 0.84 0.85 0.83 7.78 7.61 7.52 7.51 7.53 7.55 7.56 7.59 7.57 7.62 26.5 27.0 27.2 27.2 27.2 27.2 27.2 27.5 27.3 27.2 75.0 76.5 76.2 76.0 76.2 76.5 77.0 77.5 77.5 77.4 27.6 27.8 28.2 28.5 28.5 27.8 28.2 27.9 27.9 27.4 7.45 7.35 7.31 7.30 7.33 7.36 7.37 7.39 7.42 7.43 July Aug. Sept. Oct. Nov. Dec. 0.75 0.76 0.78 0.79 0.79 0.78 7.63 7.71 7.76 7.75 7,69 7.64 24.2 24.5 24.2 24.1 24.6 24.6 74.5 74.2 74.5 74.2 74.6 74.6 23.2 23.5 22.5 22.9 23.2 23.9 0.82 7.58 7.48 7.44 7.42 7.46 7.49 7.50 7.52 7.55 7.56 24.7 25.4 25.1 25.2 25.2 25 .5 25.6 26.3 26.2 25.9 74.7 75.8 75.6 75.3 75.4 76.1 76.2 76.5 76.5 75.9 24.1 24.8 24.4 24.9 24.6 25.2 25.2 25.4 24.8 24.7 1972 Jan. Feb. Mar. Apr. May- 0.86 0.86 0.88 0.79 0.77 0.78 0.77 0.78 0.83 0.81 0.83 0.82 Compiled by Federal Home Loan Bank Board in cooperation with Federal Deposit Insurance Corporation. Data are weighted averages based on probability sample survey of characteristics of conventional first mortgages originated by major institutional lender groups (including mortgage companies) for purchase of single family homes. Data exclude loans for refinancing, reconditioning or modernization; construction loans to home-builders; and permanent loans which are coupled with construction loans to ownerbuilders. Related series on conventional mortgage rates only, based on unweighted opinions of field-office directors of the Federal Housing Administration, are available somewhat sooner than the results of the FHLBB-FDIC survey, and are included-in the case of new home mortgage rates--in Table 16. Fees and charges—expressed as a percentage of the principal mortgage amount — include loan commissions, fees, discounts, and other charges which provide added income to the lender and are paid by the borrower. They exclude any closing costs related solely to transfer of property ownership. Includes fees & charges amortized over a 10 year period in addition to the contract interest rate.
@FedFRASER