Full text of H.16 Capital Market Developments : December 18, 1961
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Not f o r P u b l i c a t i o n DECONTROLLED AFTER SIX^MONTHS H.lij. December 18, 19 6 l , (Next i s s u e : c z : ; 1S61 V . : HANK C- January 2 , 1962.) (CAPITAL MARKET DEVELOPMENTS THE UNITED STATES ( I n c l u d i n g Monthly Review of Sources and Uses -of F i n a n c i a l I n t e r m e d i a r i e s ) The volume of p u b l i c s e c u r i t y f i n a n c i n g t o obtain new c a p i t a l was s u b s t a n t i a l l a s t week but i s expected t o be l i g h t throughout t h e remainder of 1961= During t h e week ending December 15, t h r e e c o r p o r a t e s e c u r i t y i s s u e s a g g r e g a t i n g $180 m i l l i o n were o f f e r e d and t h r e e S t a t e and l o c a l government bond i s s u e s t o t a l i n g $92 m i l l i o n were s o l d . During the l a s t two weeks of 1961, the o n l y c o r p o r a t e s e c u r i t y i s s u e which may — be s o l d i s a $100 m i l l i o n r i g h t s o f f e r i n g of t h e K r a t t e r Corporation, o f f e r e d w i t h o u t u n d e r w r i t i n g , which w i l l be t e r m i n a t e d whenever i t i s f u l l y s u b s c r i b e d j one o f t e n delayed S t a t e and l o c a l bond i s s u e may a l s o be o f f e r e d through n e g o t i a t e d s a l e t o obtain approximately $100 m i l l i o n i n new c a p i t a l „ Bond y i e l d s . Yields on Aaa- and B a a - r a t e d c o r p o r a t e bonds i n c r e a s e d t h r e e and one b a s i s p o i n t s , r e s p e c t i v e l y , l a s t week, while y i e l d s on S t a t e and l o c a l government bonds continued t h e i r s t e a d y r i s e of t h e p a s t s e v e r a l weeks, i n c r e a s i n g one b a s i s p o i n t . Y i e l d s on l o n g - t e r n U. S. Government bonds a l s o continued to r i s e , i n c r e a s i n g another b a s i s p o i n t t o t h e i r p r e v i o u s high f o r the y e a r . The average y i e l d on new c o r p o r a t e bonds o f f e r e d l a s t week, a d j u s t e d t o a Aaa b a s i s , was 2;.55> per c e n t , or 16 b a s i s p o i n t s above t h e average f o r t h e week ending December 8. T h i s a v e r a g e , however, i s probably n o t r e p r e s e n t a t i v e of the y i e l d which most companies could have obtained l a s t week s i n c e t h i s average r e p r e s e n t s a. s i n g l e debenture o f f e r ing of a p u b l i c u t i l i t y which has f i r s t mortgage bonds outstanding and the bonds had a 50-year m a t u r i t y a s compared with a 20-30 year m a t u r i t y of most new bond i s s u e s . S h o r t - and i n t e r m e d i a t e - t e r m i n t e r e s t r a t e s . Yields on Treasury b i l l s and 3-5 y e a r U. S. Government o b l i g a t i o n s a l s o i n c r e a s e d l a s t week. Yields on 3-month and 6-month Treasury b i l l s continued t o r e a c h new h i g h s , i n c r e a s i n g a s i n g l e b a s i s p o i n t each, while y i e l d s on i n t e r m e d i a t e - t e r m U. S. Government o b l i g a t i o n s advanced two b a s i s p o i n t s . Several f i n a n c e companies announced e a r l y l a s t week t h a t thqy were r a i s i n g t h e r a t e on t h e i r paper w i t h 90-179 days m a t u r i t y from 2 - 7 / 8 t o 3 p e r cent3 t h e average i n t e r e s t r a t e p a i d on such f i n a n c e company p a p e r i n c r e a s e d 11 b a s i s p o i n t s t o 2o9h per cent a s a r e s u l t . The average r a t e on Federal f u n d s d e c l i n e d 50 basis p o i n t s t o 1.70 per c e n t . Other s h o r t - and i n t e r m e d i a t e - t e r m i n t e r e s t r a t e s were unchanged. I-iortgage y i e l d s . Average y i e l d s on 5 - 1 A P e r cent FLA home mortgages s o ld i n t h e secondary market i n Novenfoer were unchanged f o r t h e t h i r d c o n s e c u t i v e month a t 5.72 p e r c e n t , s l i g h t l y above t h e r e c e n t low of 5 . 7 0 p e r cent r e a c h e d i n J u l y . O f f e r i n g y i e l d s on new c o r p o r a t e bonds i n November—adjusted t o a Aaa b a s i s — r o s e 6 b a s i s p o i n t s a f t e r s e v e r a l months of d e c l i n e , and t h e spread between bond and mortgage y i e l d s narrowed somewhat t o lltO b a s i s p o i n t s . This was about t h e same a s t h e average spread e a r l y t h i s s p r i n g ; t h e c y c l i c a l low spread was 108 b a s i s p o i n t s i n J u l y . Stock market c r e d i t . Customer c r e d i t in t h e stock market i n c r e a s e d s u b s t a n t i a l l y i n November, r i s i n g $127 m i l l i o n t o a r e c o r d l e v e l of $ 5 . 5 b i l l i o n a t t h e end of t h e month. Customer d e b i t b a l a n c e s , except f o r those s e c u r e d by U. S. Government s e c u r i t i e s i n c r e a s e d §112 m i l l i o n ; t h i s t o g e t h e r w i t h the s m a l l i n c r e a s e s of t h e p a s t two months, was more t h a n s u f f i c i e n t t o o f f s e t t h e June-August d e c l i n e s from t h e p r e v i o u s high reached i n May. Bank loans t o o t h e r s f o r purchasing and c a r i y i n g s e c u r i t i e s i n c r e a s e d by $15 m i l l i o n . Money borrowed by NYSE member f i r m s a l s o r o s e t o a new high in November, f o l l o w i n g f o u r s u c c e s s i v e months of moderate d e c l i n e s from t h e p r e v i o u s high reached in June; c u s t o m e r s ' f r e e c r e d i t b a l a n c e s i n c r e a s e d s l i g h t l y . These and o t h e r d a t a on s t o c k - m a r k e t c r e d i t f o r October and November a r e shown i n t h e f o l l o w i n g t a b l e . Customer c r e d i t Excluding U. S. Government s e c u r i t i e s - t o t a l Net d e b i t b a l a n c e s Bank loans t o " o t h e r s " Net d e b i t b a l a n c e s secured by U. S. Govt, s e c u r i t i e s Bank l o a n s t o " o t h e r s " f o r p u r c h a s i n g or c a r r y i n g U. S. Government s e c u r i t i e s Broker and d e a l e r c r e d i t Honey borrowed except on U. S. Government s e c u r i t i e s On customer c o l l a t e r a l Honey borrowed on U. S. Government s e c u r i t i e s Customers' n e t f r e e c r e d i t b a l a n c e s £7 End of month .Change Nov. | Oct. ( M i l l i o n s of d o l l a r s ) 5,460 li,lUl 1,319 39 5,333 4,029 1,30k a 102 103 2,7# 2,k3k 51 1,219 2,65k c/2,360 56 1,214 Corrected. StocL p r i c e s . Common stock p r i c e s , a s measured by Standard and P o o r ' s composite index of 500 s t o c k s , changed l i t t l e l a s t week, c l o s i n g on Decemb e r 15 a t 72.01, s l i g h t l y below the p r e c e d i n g w e e k ' s c l o s e and down somewhat more from the peak reached e a r l i e r in t h e week. Trading was i n s u b s t a n t i a l volume, a v e r a g i n g h . 5 m i l l i o n s h a r e s a day. +127 +112 +15 -5 -l + 7h -5 + 5 -3I n s t i t u t i o n a l i n v e s t o r s . Total savings inflow during October a t t h r e e major f i n a n c i a l i n s t i t u t i o n s — l i f e insurance companies, savings and loan a s s o c i a t i o n s , and mutual savings banks—amounted t o $1.1* b i l l i o n , or s l i g h t l y more than a y e a r ago. While t h e increase in both a s s e t s of l i f e insurance companies and share c a p i t a l of savings and loan a s s o c i a t i o n s •was about one-tenth more than l a s t y e a r , deposits of mutual savings banks declined s l i g h t l y i n c o n t r a s t t o a modest net inflow a year e a r l i e r . Time deposits a t commercial banks increased about $0.5 b i l l i o n , one-sixth l e s s than in i960. On a seasonally adjusted b a s i s , t h e October net inflow was about one-tenth l a r g e r than t h e monthly average f o r t h e y e a r t o d a t e . Appreciably l a r g e r flows in October a t both l i f e insurance companies and s a v i n g and loan a s s o c i a t i o n s were more than s u f f i c i e n t to o f f s e t a smaller i n c r e a s e in depo s its of mutual savings banks. Assets of l i f e insurance companies increased $0.7 b i l l i o n i n October, or about o n e - t a i t h more than i n October i960. Net a c q u i s i t i o n of business s e c u r i t i e s amounting t o $0.3 b i l l i o n were the l a r g e s t of any month t h i s year, although somewhat l e s s than a year e a r l i e r viien acquis i t i o n s were i n f l a t e d by short-term commercial paper purchases. Mortgage a c q u i s i t i o n s of $0.2 b i l l i o n were l a r g e r than in o t h e r r e c e n t months but about the same as l a s t y e a r . The n e t inflow of savings a t savings and loan a s s o c i a t i o n s in October was in very l a r g e volume, amounting t o $0.7 b i l l i o n , or 8 per cent more than i n i960 due t o a g r e a t e r i n c r e a s e in new deposits than i n withdrawals. On a seasonally a d j u s t e d b a s i s , inflow i n October was a t a record r a t e , about o n e - f i f t h l a r g e r than e a r l i e r t h i s y e a r . Associations cont i n u e d to make mortgage loans i n very l a r g e volume i n October. Net a c q u i s i t i o n s of mortgages of $0.8 b i l l i o n were one-third l a r g e r than a year ago and, although they were l e s s than i n September, the September-October d e c l i n e was l e s s than s e a s o n a l . Deposits a t mutual savings banks declined s l i g h t l y i n October as withdrawals, following q u a r t e r l y c r e d i t i n g of i n t e r e s t , exceeded new d e p o s i t s , f a s t October d e p o s i t s increased by S£7 m i l l i o n . While both new deposits and withdrawals were l a r g e r than l a s t y e a r , t h e r i s e in the l a t t e r was g r e a t e r than i n new d e p o s i t s . On a seasonally a d j u s t e d b a s i s , t h e deposit increase was about o n e - f i f t h l e s s than the average f o r t h i s year and the s m a l l e s t since l a s t s p r i n g . Mortgage a c q u i s i t i o n s of §0.2 b i l l i o n were l i t t l e changed from the average of t h e f i r s t nine months of 1961 but were s l i g h t l y l a r g e r than l a s t y e a r . A l l other balance sheet items d e c l i n e d as they u s u a l l y do in October; the d e c l i n e in business and Federal agency s e c u r i t i e s of $5>6 m i l l i o n was the l a r g e s t s i n c e January I9f?9. More d e t a i l e d information concerning r e c e n t c a p i t a l market developments i s presented i n t h e a t t a c h e d e x h i b i t s . Capital Markets Section, Division of Research and S t a t i s t i c s , Board of Governors of t h e Federal Reserve System. " LONG-TERM BOND YIELDS HIGH-GRADE LOWER-GRADE V—V-,,— Exhibit B - Tables f o r Exhibit A Long-term Bond Yields High-grade Date Corporate Aaa 1 / State and local government Aaa 3/ U. S. Govt. . long-term 2 / (per cent) 195U - Low 1957 - High 1958 - Low 1959-60 - High , I960 - Low 1961 - High Low Nov. Nov. Dec. Dec. /;ec. 17 2h 1 8 15 e / 2 . 8 5 (4/23) 4 . 1 4 (9/27) 3.55 (5/2) 4 . 6 l (1/29/60) U. 23 (9/9) 4.46 (9/15) 4.21 (3/17) it. 39 .4.39 4.38 4.39/ 4.42 ^ 2.45 (8/6) 3 . 7 6 (10/18) 3 . 0 7 (4/23) h.h2 (1/8/60) 3.75 (8/5) Spread between U. S. Govt and Corporate State and Aaa local Aaa 1.90 (9/2) 4.06 (12/15) 3.70(5/12) 2.99 (9/1) 3.37 (7/6) 3.12 (2/23) .30 .60 ,22 .59 .19 .57 .34 4.00 3.98 4.01 4.05 4.06 3.26 3.29 . " 3.31 3.32 / 3.33^ .39 .a .37 .34 .36 3.45 (8/29) 3,65 (9/24/Sfl) 2.64 (5/1) .30 .50 .34 .92 .53 .76 .46 .74 .69 .70 .73 .73 Lower-grade Date Corporate Baa 1 / State and l o c a l govt. Baa Spread between Aaa and Baa State and Corporate local govt. (per cent) 2.93 (8/5) 4 . 5 1 (8/29) 1954 - Low 1957 - High 1958 - Low 1959-60 - High i960 - Low 1961 - High Low 3.44 5.10 4.51 5.36 4.98 5.13 (10/27) 5.00 (4/21) 4.16 (3/23) 3.93 (11/9) Nov. Nov. Dec. Dec. Dec. 5.11 5.10 5.10 5.10 5.11 ' 3.95 3.96 4.01 4.03 4.o4 17 24 1 8 15 e / (12/31) (11/20) (7/11) (2/12/60) (9/9) 3.64 (6/1) 4 . 4 6 (1/7/60) 3 . 9 8 (12/29) .52 1.27 .77 .84 .71 .81 .66 .96 1.21 .93 1.08 M .93 ,57 .72 .71 .72 .71 .69 .69 .67 .70 .71 .71 B/ Preliminary* 1/ Weekly average of del ly figures. Average term of bowde Inoluded l a 23 »20 year#. if Weekly average of dally figures. The eerie# lnoludee bonds due or callable In 10 years or more. 3/ Thursday figures. Only general obligation bonds are Inoluded; average term 1# 20 years. Note,--Highs and lows are for Individual series and nay be on different dates for d i f f e r e n t s e r i e s , for spreads, high r e f e r s t o wldsst, and lew to narrowest. • • ' U EXHIBIT C SHORT- AND INTERMEDIATE- TERM INTEREST RATES GOVERNMENT 3 - 5 YEAR ISSUES 6 - MONTH BIUS 1 f( r" A / r n\ ^ / .IAA; A X/v 1 \ BANKS AND u i i x < OTHER | / Z 1 * |A «J\ m , 1 ! D!SC0U::TJIATE | | New York I 0 1™. r PRIVATE J y j DISCOUNT \Jr> I ,u .L BORROWERS ! ! I , ' -7Exhibit D - Tables f o r Exhibit, C 3 i o r t - and Intermediate-tera I n t e r e s t Kates Government Date Discount rate 1/ 195^ - Low 1957 - High 1958 - Low 1959-60 - High I960 - Low 1961 - High Low 1.50 3.50 1.75 it. 00 3.00 3.00 3.00 .61 3.61 .58 it. 5 9 2.11 Nov. Nov. Dec. Dec. Dec. 3.00 3.00 3.00 3.00 3.00 2.53 2.5it 2.56 2.58 / 2.59/^ 17 2it 1 8 15 2 / Yields 6-month b i l l s 2/ (per cent) 3-month b i l l s 2/ (6/11) (10/I8) (5/29) (1/8/60) (10/28) 3-5 year issues 2/ Spread between y i e l d s on 3-month b i l l s and y i e l d s d 6-mo. b i l l s 1 3 - 5 y r . issues! 3.il0 (12/30) 3 . 8 6 (8/11) 3.15 (5/L2) .26 .79 .16 .it h .12 . .66 .86 .Oh 1.81 .38 1.51 .92 3,69 3.69 3.7it 3.82 3.8it .21 .19 .22 .30 .30 1.16 1.15 1.18 1.2it 1.25 1 . 6 6 (4/30) il.Oii (10/18) 2.11* (6/6) 3 . 0 2 (12/26) 5 . 0 7 (1/8/60) 2 . 3 8 (12/30) 5 . 0 0 (12/24/59) 2.59 ( 1 2 / 1 5 ) - 2 . 8 9 (12/15) 2.17 (1/27) 2.35 (it/28) 2.7it 2.73 2.78 2.88 ;2.89 - Banks anipl. Otherr Private Borrowers Prime rate 1/ Stock Exchange c a l l loan 1 / Finance company paper 3 / Federal funds lj/ Spread between 3-rao. b i l l s und finance co. paper (per cent) 19$k - Low 1957 - High 1958 - Low 1959-60 - High, 1960 - Low 1961 - High Low 3.00 i*,50 3.50 5.50 U.50 it.5o 3.00 It. 50 3.50 5.00 •it. 50 it.5o it.5o Nov. Nov. Dec. Dec. Dec. k.to It. 50 li.5o lt.50 li.5o L5o JU-5 0 it.5o it.5o it.5o 17 2k 1 8 15 g / ' 1.25(12/31) 3 . 8 8 (11/15) 1'.13 (e/a) 5'. 1 3 (1/72/60) 2.68 (lz/JO) 2.9it (12/15) 2.50 (7/28) 2.73 2.78 2.81 2.83 2.9U 3.50 .13 it.00 .95 (11/a) (%/M) (5/13/60) (12/2) 2.88 (11/10) .it3 (1/27) 2.90 2.75 1.75 2.20 1.70 0 .63 -.35 1.02 .22 .56 .11 .20 .2it .25 .23 .3b 1/ W.ekly rata .how* l in e f f e c t at end of period. Dl,count r a t i t a for h d . r U R . « r v i Bark of Hew York. Stock Exchange call Icah rat* I s going rat* on call loawa siourod by customer*' stock exchsnge collateral at Hon York City banks, M « e rat* lo that charged by large banks on Jhort-ter* loana to bualnaaa borrowera of the highest credit standing, • 2/ Harltut yield) weekly average a computed from dally oloalng bid prices. Series of 3-5 year laauaa coital ate or aeleoted note a and bonds. • 3/ Average of dally rates publlahad by flnaace coopanlee for directly pitied paper for varying maturities In the 4/ WMkly dally effective r a t e , which la the rate for the heavleat voluae of purchase and sale tranaactlona aa reported to the Federal Reaarve Bank of Now York. Not,...HIaha and lows are for Individual eeriea and may be on different dates for different dates for d i f f e r e n t series, for apreada, high r e f e r s to wideat, and low to narrowest. STOCK MARKET STOCK H A I K U CREDIT '-XrCHANGE IN SERIES MORTGAGE AND B O N D YIELDS Exhibit ? - Tables f o r Exhibit E "9- Stock Market Date 1957-60 - High Low 1961 - High Low October November Dec. 1 Dec. 6 Dec. 15 2 / Stock p r i c e index 1/ Trading Gonrnon volume y yields 2/ (millions ( p e r c e n t ) of shares) 6 0 . 5 1 (7/31/59) 39.it8 (12/1:9/57) 72.0it (12/8) 58.it8 ( 1 / 6 ) 68.00 .71.07 71.78 72.0it 72.01 Stock market customer c r e d i t Customers 1 Bank debit balloans t o ances it/ "others" 5 / ( I n imLllions o l d o l l a r s ) Total it,76it (4/59) 3,it0l (4/59) 1,373 ( 5/59) 3.08 it. 72 i/2.82 3.32 it.'9 l.it 5.8 2.7 5, it60(12/6l)it,ia(12/61)i,377(8/30) it,it2it(l/6l) 3,253(1/61) 1 , 1 6 1 ( 3 / 8 ) 2.90 2.82 2.83 2.82 2.8it 3.3 it.it it . 5 it. 2 it.5 5,333 5,it6o n.a. n.a. n.a. 3,55ii (1/53) 2shG2 it, 029 it,litl n.a. n.a. n.a. (12/57) 1 , 0 6 0 (11/57) 1,30it 1,319 1,319 l,32it n.a. n.a.—Not a v a i l a b l e . fi/ Ppnlle-lwry. 1 / Standard and Poor's cciapoelte Index of 500 ocianon s t o c k j , weekly o l o s l i y prlo»?, 1911-43*10. Monthly data are aviragos of d a l l y f l e u r c o r a t h o r than of Rrltlcy'a only. Hlghn and lows ore f o r M d n y n ' data only, 2 / Standard and Poor'o ocopotlto otock y i e l d baood on WednenCay data converted t o weekly e l c o l i y prleeo by Federal Reserve. Yleldo ohovn are f o r datco on which prloa Index reached i t s high or low. 3 / Averages of dally t r a d i n g volviie on the Hew York Stock Bcctmye, Aj End of month fleuroo f o r member flir.fi of the I law York Stock Ecchange which carry margin accounts) exclude u balance* oecured by U, S. Oovcrimor.t o b l i g a t i o n s . 5 / Wednesday flcureo f o r weekly reporting member tanks. Excludes loans for purchasing or carry! *6 V, S, Government re curl t i e s . P r i o r t o July 1, 1059, euth lo.-nn are excluded only a t banks I n How York and Chlcwco. Weekly reporting banks account f o r about 70 per cont of loans to othero. For f u r t h e r d e t a i l oeu B u l l e t i n . Mortgage and Bond Yields 1/ FHA mortgages 2/ 1953-58 - High Low 19^9-60 - High Low 5.63 1.56 6.2U 5.57 (11/57) (2/5$) (1/60) (3/^9) Spread between now Aaa c o r p o r a t e c o r p o r a t e bonds and bonds 1 / New 3/ [Seasoned U/ F11A mortf'fiKoo j Soaoonud bonds it. 81 2.7it 5.29 it. 29 (6/57) (3/5W (9/59) (2/59) it. 12 2.8it L.61 1.12 (9/57 (V5W (1/60) (1/59) 1.96 .5it 1.76 .83 .90 -.12 .77 -.16 .21 .lit -.07 -.16 -.07 wmmm 1961 - J u l y August September October November it.62 5.70 5.71 5.72 5.72 5.72 4 / Mco^y', Inventors Service. it. 59 lt.38 L26 it. 32 h.hl it.it5 U.U5 h.hZ it. 39 Monthly a v e r t s of d.vily dat*. See Exhibit 1.08 1.12 1.31 1.U6 l.itO Exhibit -10- G Yields on New Corporate Bond Issues Adjusted to an Aaa Basis Amount Average Number of issues yield of issues included (per included (millions of dollars) c e i t ) inthly averages; >ol - January February March April May July. August September October November December ekly averages: 61 - January 6 13 20 27 February 3 10 17 24 March 3 10 17 24 31 April 7 Ik 21 28 May 5 12 19 26 ' 3 6 It 12 15 18 4 4 2 7 9 29.0 97.8 108.0 563.0 451.0 701.5 273.0 115.0 78.8 200.0 229.0 1 1 1 1 2 3 10.0 7.0 12.0 6.8 48.0 43.0 k 108.0 3 3 2 k 3 1 6 5 90.0 82.0 312.0 79.0 165.0 30.0 91.0 165.0 14.35 June 2 4.31 9 4.26 16 4.42 23 4.51 30 4.65 July 7 4.62 14 21 4.59 28 4.38 4.26 August 4 4.32 11 18 25 September 1 8 4.45 15 4.4o 22 4.27 29 4.61* October 6 4.32 13 20 4.27 27 November 3 10 17 4.26 24 December 1 4.28 8 4.40 15 22 4.42 29 4.54 4.49 :1962 4.47 January 5 12 4.47 4.55 11 Amount Average Number of issues yield of issues Included (per included (millions cent) of dollars) 3 4 6 3 2 60.0 307.0 137.0 130.0 67.5 4.-66 4.68 4.68 4.56 4.58 1 1 2 2 1 1 8.0 200.0 65.0 55.0 20.0 4o.o 4.60 4.64 4.46 4.54 4.73* 4.60 1 18.0 4.46 1 2 60.8 45.0 4.36 4.25 2 3 3 60.0 95.0 45.0 4.21 4.28 4.21 : | ; *4 l l 2 1 94.0 60.0 30.0 75.0 Loo 4.29 4.35 4.40 4.29 : ; : , id A by Moody'a Investors Service (except s e r i a l , equipment-trust and convertible i s s u e s , E'ferings'of natural gas pipeline and foreign companies, and issues guaranteed by the jderal Government) weighted by s i z e of issues. Yields on Aa- and A-rated bonds are f i r s t 3justed to an Aaa b a s i s , using the comparable spreads in yields on seasoned bonds (Moody1a reroges). Averages r e f l e c t changes in industrial composition, type, maturity, and c a l l "ovisions of new o f f e r i n g s . Weekly averages considered unusually unreliable as tdicators of Interest rates on new issues because of the small number or special laracteristios of offerings included e t c . are marked with an asterisk. Exhibit H Long-term Corporate and State and Local Government Security Offerings and Placements (3h m i l l i o n s of d o l l a r s ) 1961 January February March 580 66? 562 Corporate 1 / 1 I960 | 570 715 860 April May June 2,118 1,2# 1,318 761 577 . 1 , 0 i*u. July .August September 1,028 762 61*7 " 736 967 726 'New ca p i t a l 1959 1961 State and l o c a l 2/ ! 1959 1 I960 •891* 785 887 720 61*1 1,085 719 51*5 991 . 931 568 987 535" 710 703 1*70 £/58l e/750 1*92 606 683 1*1*3 521 470 f l 900 ' e/600 e/800 e/550 3it8 501 1*91 593 1*50 1*70 700 611 568 2/1,033 e/800 e/975 1st 2nd 3rd Z*th 1,80? 1*,695 2,1*37 e/2,808 2,11:5 2,382 2,1*28 2,698 2,201* 2,567 1,979 2,61*2 2,168 2,1*1*6 e/l,801 e/1,950 1,880 2,256 1>780 l,3h0 1st half 6,Soli Three quarters 8,911 Year , . <y i l , . 7 k 9 1,527 6,955 9,653 it, 771 6,750 9,392 U, 613 e/6,ia5 e/8,365 L,136 5,916 7,257 quarter quarter quarter quarter 6i*8 . 859 638 715 689 763 October November December 890 '956. 852 ; 821 738 6# 2,11*5 2,1.88 I,li33 1,521 . L,631* . 6,067 7,588 Excluding i ' i m n c e companies ] / 1st 2nd 3rd l*th quarter quarter quarter quarter Year f . 1,55U 4,552 2,337 2 / 2 , 708 1,716 2,165 2,016 2,317 1,999 2,1*12 1,716 2,503 </11,11*6 8,21*6 8,630 57 S e c u r i t i e s and Exchange Commission estimates of net proceeds. Investment Bankers Association of America estimates of principal amounts. Total new c a p i t a l i s s u e s excluding o f f e r i n g s of s a l e s and consumer finance companies. Exhibit I New Corporate Security Issues, VType of Issue and Issuer (In millions of dollars) Quarter or month Net proceeds f o r Gross proceeds f o r new c a p i t a l and refunding 1 / new capital 1/ 2/ Bonds Common Mfg. Public Communi- Other Total Publicly Privately and u t i l i t y cations issuers offered offered pfd. stk. •I II III IV 2,281 787 2,6o5 9"60 2,062 807 2,739 1,00k I960 I II. in IV 2,265 934 2,537 1,071 2,520 1,336 2,832 1,162 1961 I II HI IV 1,992 5,352 2,566 19# i960 - Jan. Feb. Mar. -Apr. May July Aug. Sept. Oct. Nov. Dec. 1961 Jan. Feb. Mar. Apr. May July Aug. Sept. Oct. 2I Nov. e / Dec. 835 891 8# i,o44 660 811 396 691 3# 750 468 364 813 979 170 927 105 13 99 I460 928 79k 942 890 795 770 751 955 536 692 429 416 298 511 562 625 598 808 652 696 189 149 317 381 1,059 913 896 997 662 2,303 772 880 1,275 1,139 449 61*1 324 253 735 88&--"357 805 318 608 186 1,124 510 415 777 996 592 329 747 621 928 1,009 518 895 323 190 29k 311 232 220 319 236 229 289 157 357 441 126 189 221 226 202 265 127 175 128 150 131 131 601 695 696 2,231 1,312 1,779 1,075 813 678 1,101 820 178 273 211 713 666 424 225 123 336 380 ' %$ ^935 129 294 167 331 154 1,170 318 320 355 572 . 283 .259 . 392 111 177 336 218 30b 158 160 280 381 X, 595 x 81 832 >%\ 1,052 803 59 . 67 172 171 92 249 182 220 161 185 249 191 155 245 198 303 144 362 126 222 303 203 314 180 36 • 05 68 52 36 61 57 165 94 254 27 100 319 318 422 236 304 373 370 359 168 249 366 381 169 99 248 574 447 446 428 255 252 293 210 137 160 84 254 439 389 269 215 111 262 2(J0 21 41 19 994 85 i 16 16 13 75 25 70 253 368 211 297 289 467 315 279 209 434 240 p7 Preliminary. e? Estimated. 1~J Gross proceeds exceed net proceeds by the cost of f l o t a t i o n . 2 / For t o t a l see Exhibit Rj other i s s u e r s are e x t r a c t i v e , r a i l r o a d and other t r a n s p o r t a t i o n , r e a l estate and finance and commercial and other. Source.—Securities and Exchange Commission. Exhibit J Other Security Offerings (In millions of d o l l a r s ) Gross long-term 17" Foreign government 2/ Federal agency 3/ 1961 I960 | 1961 | 1959 I960 | Januaiy February Ma reh 6 29 20 2 175 70 81 60 2 252 April May June 2 66 29 3h 72 ljO 58 50 U2 100 lli9 278 lii8 3514 25 1 36 85 1 35 250 193 199 July August September •£ 2 October November December 3h 2 111 Year 533 ' April May June July August September 1959 199 175 — 98 150 — 33 30 70 160 1JU9 181 86 517 1,672 707 State and l o c a l government 5/ JanuaryFebruary March 182 150 150 Federal agency 3/ 160 195 -8 58 II4O -80 -k 181 h -1U1 -162 -171* -196 -202 -59 -82 176 33 -103 -1*2 -155 70 -II16 -157 197 -25 -197 -79 -87 207 -277 170 320 50 368 286 109 518 -86 1*8 1*15 -175 57 392 131 22 193 108 95 23 -201 362 133 79 . -16 '50 -189 -81 -176 -117 98 -23 -33 -250 280 21*0 18 362 -633 1,969 October November December Year E/ 1/ Preliminary. Thooe data d i f f e r from those i n Exhibit 0 i n t h a t refunding iaeuea, as well ee new capital i s s u e s , are Included* Long-term s e o i r i t i e s are defined aa those maturing in more than one y e a r . 2/ Include a s e c u r i t i e s o f f e r e d in the United State a by foreign /'overnuont.i and t h e i r subdivisions and by i n t a r national organizations. Sourcet Seouritles and Exchange Commission. 3/ Isaues not guprantwed by the U. S. Cover reient, Sourcoi long-term, Soourltles and Exchange Commissi onj shorttorm , Treasury Department and Federal Reserve. 4 / These data d i f f e r from those i n Exhibit 0 and above i n t h a t they represent now o f f e r i n g s leBa r e t i r e m e n t s , whether from the proceeds of refunding issues or from other funds. Data include only issues with original maturity-of one year or l e s s . " 5 / P r i n c i p a l l y tax and bond a n t i c i p a t i o n notas, warrants or c e r t i f i c a t e s and Public Housing Authority notes, I * soma Instances PHA notes Included may have a somewhat longer term than one y e a r . Sourcei Bond Buyer and Federal fieaorvo. • 1 "" 1 '• • Exhibit K —ill— Large Long-term Public Security Issues f o r New Capital (Other than U. S. Treasury) 1 / Proceeds of Large Issues Offered (In millions of d o l l a r s ) Month I960 - November December 1961 - JanuaryFebruary March April May July August September October November Total Corporate Bonds (other than Convertible bonds convertibles) 165 260 • U7 26? 70 1,572 557 532 hlS 185 168 35U 391 1# 235 106 230 25 560 kbo ii35 285 165 78 205 320 . Stocks State and local government 25 la 37 5 1,010 62 97 115 20 58 81 186 222 391 360 105 383 256 616 179 281 h3$ 326 1*80 —— —— —— I4O 15 75 33 67 26 Other 2/ 150 99 67 25 151 • 100 73 1*0 . 250 Large Individual .Issues Offered December 1 through 15 Type 3 / Amount Coupon (millions Maturity Offering of net i n t e r - y i e l d dollars) est cost CORPORATE Deb. Borden Co. Gen. Tel. Co. of C a l i f . 1 s t mtg. bds. Deb. Tenn. Gas Transmission Co. P a c i f i c Lighting Corp. Com. s t k . -fr Bank of America Com. s t k . Rating 50.0 25.0 50.0 35.9 9h.k 1991 1991 1981 28.5 25.0 1962-87 1963-82 3.30 3.11 1.60-3.50 1.60-3.35 33.7 35.0 53.1 1963-92 2002 1962-86 3.83 3.31 1.75-1.00 A k.hD £/ 1.70-3.70 A 23.0 15.9 1962-2000 3.65 196i|-87 n.a. 1.75-11.10^ __ 2.10-3.60 A li-3/8 1-5/8 5-l/ii Aa A Baa 1U5 L63 5.15 STATE AND LOCAL GOVERNMENT G.O. Baltimore, Maryland State of Connecticut G.O. Oakland Co., Twelve Town Drainage D i s t . , Mich. G.O. Rev. Grand River Dam Auth.,0kla G.O. New York City, New York Penna. S t a t e Public Sch. . Rev.-Rent. Bldg. Auth. Oklahoma City, Okla. G.O. OTHER V Aa Aaa lootnotes —Rights o f f e r i n g . 1/ I n c l u d e s c o r p o r a t e and o t h e r s e c u r i t y o f f e r i n g s of £15 m i l l i o n ana o v e r ; S t a t e and l o c a l government s e c u r i t y o f f e r i n g s of £10 m i l l i o n and over. 2 / I n c l u d e s f o r e i g n government and I n t e r n a t i o n a l sank f o r R e c o n s t r u c t i o n and " Development i s s u e s and non-guaranteed i s s u e s by f e d e r a l a g e n c i e s . 3 / I n t h e case of S t a t e and l o c a l government s e c u r i t i e s , G.O. denotes g e n e r a l o b l i g a t i o n s j R e v . - U t . , revenue o b l i g a t i o n s secured only by inccv •. from p u b l i c u t i l i t i e s ; R e v . - Q . U t . , revenue bonus s e c u r e d only by revenue from q u a s i - u t i l i t i e s ; R e v . - S . T . , revenue bonds secureo by revenue from s p e c i f i c t a x e s o n l y ; R e v . - R e n t . , revenue bonds secured s o l e l y by l e a s e payments» h / 1>86-87 M a t u r i t i e s n o t r e o f f e r e d . 5/ An a d d i t i o n a l m i l l i o n in bonds due 15*65-68 were sold t o refund o u t standing s e c u r i t i e s , 6 / 1997-2000 m a t u r i t i e s not r e o f f e r e d . -16- Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U. S. Treasury) ( 1 / E j e c t e d Proceeds from Forthcoming Large Issues During month following date shown Date of computation Corporate 260 91 110 55 1,580 5i|2 197 521 170 175 358 316 356 I960 - Nov. 30 Dec. 30 1961 - Jan. 31 Feb. 28 Mar. 31 Apr. 28 May 31 June 30 July 31 Aug. 31 Sept. 29 Oct. 31 Nov. 30 . Others/ 2h2 UL2 181 307 559 236 U3L 195 106 399 251 597 295 Subsequent to date shown State and Corporate l o c a l govt, 335 1,036 1,0U6 1,125 1,700 687 611 666 255 21*0 5ok In • 1*21 15 75 73 .35 560 682 360 638 806 579 771 291 537 530 h$h 693 198 15 75 § Forthcoming Large Offerings, as of December l5 Issuer Type Amount Approximate date (millions of o f f e r i n g of d o l l a r s ) | CORPORATE K r a t t e r Corp. New York Telephone Co. Commerce Oil Refining Corp. Realty C o l l a t e r a l Corp. Sub. deb. Htg. bds. Deb., bds. & com ; Coll. t r . notes 100.0 60.0 1,5.0 20.0 Dec. • ( r i g h t s expire) Jan. 10 Indefinite Indefinite STATE AND LOCAL GOVERNMENT Florida Turnpike Auth. Georgia Rural Roads Auth. -^Commonwealth of Puerto Rico Montgomery Co., I-ialyland East Bay Hun. U t i l . D i s t . , C a l i f . San Jose, C a l i f o r n i a Ascension-St. James Bridge & Ferry Auth. Orleans Parish Sch. D i s t . , La. Dade County, Florida Jacksonville Expressway Auth. Los Angeles Dept. of Ktr. & Pwr. None OTHER Rev. Rev.-S.T. 6.0. 0.0. G.O. G.O. . Rev.-Ut. G.O. G.O. Rev.-Ut. Rev.-Ut. 100.0 13.0 25.0 13.2 30.0 20.0 30.8 10.0 16.0 liO.O 16.0 Dec. Jan. Jan. Jan. Jan. Jan. It 3 9 9 10 Jan. 15 Indefinite "Indefinite Indefinite Indefinite J-2 -47> Footnotes *—Included in table for f i r s t time. 1/ Includes corporate and other issues of $15 million and over; State and l o c a l government i s s u e s of $10 million and over. Includes foreign government and International Bank f o r Reconstruction and Development i s s u e s and ncn-guaranteed issues by federal agencies. Note.—Deletions f o r reasons other than sale of issue: None. 2/ Exhibit H Sources and Uses of Funds by L i f e Insurance Companies U.S. Govt. Cash i t i es Value of a s s e t s a t end of p e r i o d : 1957 - Dec. 1958 - Dec. 1959 - Dec. i960 - Dec. 19.61 » Oct. Changes: 1959 - July Aug. Sept „ Oct. Nov. Dec. I960 - Jan. Feb. liar. Apr. i-iay July Aug. Sept. Oct. l;:ov. Dec. 1961 - Jan. Feb. tar. apr. llay June 2 / July Aug. Sept. Oct. l.o v." Dec. Uses of funds 1/ S t a t e and l o c a l govt. securi t i e s 2 / ities Mortgages Other Total sources (In m i l l i o n s of d o l l a r s ) 13,206 101,309 lk,6k0 107,580 16,126 113,650 17,625 119,717 18,936 125,06k 7,026 7,182 6,858 6,m 6,103 k2,133 kk,6l2 16,901 48,896 50,916 -25 16 -39 20 33 99 39 95 -181 -18 -132 -168 191 81 82 203 195 219 110 31 18 Ik 18 2k 19k 167 207 2k5 235 30k lk6 110 106 91 lk6 313 656 500 195 555 k95 791 -71 -53 -30 39 -12 33 12 k -51 90 -35 99 153 -36 -167 ^85 -62 -102 73 -kO -6 -62 23 -103 20k 125 10k 13k 231 125 167 168 kO 311 198 188 -2k 25 35 21 26 13 10k k3 82 33 26 17 336 196 2^2 225 203 192 63 226 179 21k 206 277 -•k6 207 115 _95 128 211 206 175 122 11 102" 173 552 k6k 299 k29 51k k69 6# 57^ 2k2 128lk8 135 170 270 2k5 211 213 288 k9 31 33 3k 5 -13 25 36 29 17 210 135 208 202 170 222 107 16k 165 199 ^ -5k -9 -50 9 75 -39 kO -18 lk 31 17 101 -3 -k7 63 -182 71 -50 13 2,377 2,691 3,221^ 3,622 3,868 35,271 37,092 39,237 kl,798 k3,580 1,29k 1,363 1,307 1,332 1,331 202 202 186 119 58 31 lk2 | 128 1 138 105. 59, 522 651 750 kEk 518 k52 5k: 289 630 521 509 653 Uses of funds represent net changes i n a s s e t s and t h e r e f o r e r e f l e c t n e t , r a t h e r than gross, uses, 2/ i n c l u d e s s e c u r i t i e s of domestic corporations only* S o u r . - - I n s t i t u t e of L i f e Insurance. Digitized forc eFRASER . Exhibit N -19- Sources and Uses of Funds by Savings and Loan Associations Cash Value of a s s e t s a t end of period 1957 - Dec. 1958 - Dec. 1959 - Dec. I960 - Dec. 1961 - Oct. Changes: 1959 - July Aug. Sept. Oct. Nov. Dec. 2/1960 - Jan. Feb. Mar. Apr. May July Aug. Sept. Oct. Nov. Dec. 2 / I 9 6 I - Jan. Feb. Mar. Apr. May Uses of funds 1 / U. S. Govt. Mortgages ities 2/ Other Total sources Sources of funds Net change Borrowsavings ing y Other capital ( I n m i l l i o n s of d o l l a r s ) 2,11*6 2,585 2,183 2,715 2,805 1,586 5,086 40,049 45,627 53,194 60,084 67,305 2,770 3,108 3,676 4,104 4,578 48,138 55,139 63,530 71,489 79,774 41,912 47,976 54,583 62,154 68,570 -U31 -42 -52 -69 61 371 108 23 -7 10 -28 -25 803 740 679 626 460 468 -113 14 64 86 141 -65 367 735 684 653 634 749 201 394 447 396 484 1,205 -301 -34 49 -27 80 329 -236 30 24 104 86 428 196 65 -22 -2 21 -143 -33 -27 1 20 36 -3 316 398 547 565 635 780 615 713 643 605 501 572 -119 65 93 106 203 -58 -127 2 63 85 153 -38 92 494 667 642 939 908 219 718 731 814 776 959 468 409 623 372 630 1,216 149 489 602 667 558 1,388 -462 -114 -126 37 5 211 -127 22 49 -14 51 272 86 199 170 233 304 -519 197 207 80 161 167 -701 -95 59 3 93 192 107 -18 371 427 689 694 815 993 738 906 802 786 -107 71 123 113 216 -60 -152 79 83 108 262 749 922 813 1,180 1,096 351 967 927 1,018 591 553 705 417 800 1,362 ill 496 662 719 -465 —80 -26 88 41 274 -l 132 130 73 136 276 243 308 339 -54o 241 3# 135 226 3,173 3,819 k,k77 2k 1U9 132 -227 -86 1,379 1,444 2,387 2,191 2,357 31 119 ' 148 136 56 222 4,847 5,719 6,560 7,144 8,847 135 222 89 121 94 -678 31 -8 July Aug. 68 Sept.i/ k7 . -5 Oct. 8k ko Nov. Dec. y Preliminary. ~rj Revised. 1 / Uses of funds represent n e t changes in a s s e t s and t h e r e f o r e r e f l e c t n e t , r a t h e r than g r o s s , u s e s . Savings and loan a s s o c i a t i o n s do not hold business s e c u r i t i e s and data on holdings of State and l o c a l government bonds, presumed to be small, are n o t a v a i l a b l e . 2/ Data f o r 1957 adjusted t o include mortgage pledged shares a s c u r r e n t l y r e p o r t e d . 3 / Advances from Home Loan Banks and o t h e r borrowing. DigitizedSource.—Federal for FRASER Savings and Loan Insurance Corporation. Exhibit 0 -20- Sources and Uses of Funds by Mutual Savings Banks Value of a s s e t s a t end of period • 1957 - Dec. 1958 - Dec. 1959 - Dec. 1960 - Dec. 1961 - Oct. Changes: 1959 - July Aug, Sept, Oct, Nov, Dec. I960 - Jan, Feb. liar. Apr. May July Aug. .Sept. Oct. Nov. Dec. 1961 .- Jan. Feb. Mar. Apr. May July Aug. Sept. Oct. Dec. 2/ Uses of funds 1 / Busi- State & Total U. So ness local Govt. sources MortCash secur- secur- govt. Other gages ities ities ities 2/ (In millions of d o l l a r s ) 6,170 1,331 4,973 4,849 5,080 5,068 682 725 722 672 683 -79 3 -2 -27 20 111 -13 -12 -32 -281 -85 -12 -47 13 -2 -55 -28 23 4 -I 8 -20 -8 -24 -131 37 41 -86 42 108 -69 -6 22 -8 9 84 -9 -11 32 -148 -80 -93 -48 30 -32 -156 - 68 -42 -12 -9 52 -19 13 57 38 -8 32 . -4 34 57 -49 21 9 -51 30 27 -26 -14 46 -2? 106 100 117 -216 -13 -41 18 6 -15 -120 3 -15 46 -11 27 32 2 -23 -19 -56 890 921 82? 872 84l 7,552 7,266 6,861 6,239 20,951 761 23,039 855 211,768 910 26,709 1,001 28,536 1,061 35,168 37,779 38,942 40,573 42,360 • Sources of funds Net change in deposits 31,695 34,041 34,983 36,353 37,968 179 156 160 137 124 132 -12 33 31 -37 42 -12 32 192 163 -283 65 218 -54 80 197 -187 -27 340 -6 159 116 -9 150 3 ' 13 129 161 -23 169 -4 -4 -159 206 -5 1 196 -6 168 . 171 -5 -5 157 -12 1J3 41 -21 63 -59 42 6 14 -25 - 13 -14 -11 167 319 -132 176 178 118 223 233 -31 154 , 237 -68 50 320 -95 58 221 21 105 278 56 39 385 17 26 29 -51 30 -23 -28 54 49 -Ii4 233 272 4o4 -154 262 218 164 232 220 -?4 170 136 351 -54 114 , 367 J!/ 23 99 310 -15 -5 -l -2 . 1 22 »2 - 1 1 -5 161 i4o 204 .176 187 201 201 207 156 178 Other 3,473 3,738 3,959 4,220 4,392 86 112 -34 -96 92, -122 57117 -1, -37-: 118 , -43 •• 97 ' 118 -45 . -87 115 -148 63X 136. 53;: -100 4 1485 133# -90L -59 & 1 than g r o s s , uses, ' Includes Canadian government and p o l i t i c a l subdivisions, International Bank f o r Reconstruction and Development, nonguaranteed federal agency and other bonds as well as corporate bonds and stock. j j I f