Full text of H.16 Capital Market Developments : January 20, 1964
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Not for Publication DECONTROLLED AFTER SIX MONTHS January 20, 1964. . Hr.14 - ———-5 ; | PITAL-MftRKETS DEVELOPMENTS IN THE UNITED STATES (Including Review of Corporate Securities Sold During 1963 to Retire Outstanding Obligations) J The volume of public security financing to obtain new capital was very substantial last week and will not be much smaller this week. Last week, ended Januarv^jy^j-e $40 million corporate issue and four large State and local gove?Sen^bond issues with par value of $234 million were sold. This week, ending January 24, three large corporate issues aggregating $97 million (including expiring rights offers) and three State and local issues totaling $141 million are scheduled for sale. Bond yields. Changes in yields on seasoned long-term bonds were mixed but minor last week. Yields on Aaa-rated corporate bonds edged up a basis point to 4.38 per cent, the highest since late March 1962. Aaa-rated State and local government bond yields, however, after three weeks of stability, dropped a basis point to 3.10 per cent, and yields on lower-grade municipals also fell one basis point to 3.56 per cent. U. S. Government and Baa-rated corporate bond yields were unchanged. Yields on new corporate averaged 4.44 per cent last week, the previous week. This decline, because of the small size of last bonds, adjusted to an Aaa basis, six basis points below the average for however, was probably not representative week's only eligible issue. Short- and intermediate-term interest rates. Rates on 3-month Treasury bills rose a basis point to 3.54 per cent last week, but those on 6-month bills eased a basis point to 3.65 per cent. Yields on 3-5 year U. S. Government obligations declined one basis point to 4.07 per cent. The average effective Federal funds rate continued at 3.50 per cent. Other rates were unchanged. Housing starts and permits. Seasonally adjusted private housing starts, which had dropped sharply in November, increased by 3 per cent in December to a seasonally adjusted annual rate of 1,597 thousand, including farm. This was 13 per cent below the recent peak in October and 2 per cent above December of 1962. For 1963 as a whole, starts totaled 1,589 thousand--9 per cent above a year earlier and 5 per cent higher than the advanced level in 1959 when the new Census series began. On a three-month moving average basis, starts in the OctoberDecember period were at an annual rate of 1,667 thousand, down 3 per cent H. 14 -2- from the high in the previous period and 7 per cent above the same period in 1962. Starts financed without Government-underwritten mortgages represented 79 per cent of total starts in December. This share which tends to decline at this season of the year, about matched the proportion a year earlier. For all of 1963, the average proportion was 81 per cent, compared with 77 per cent during 1962 and 71 per cent in 1959. Seasonally adjusted building permits in_December rose to a new high for this series, following a moderate decline in November. The rise was due entirely to a very substantial expansion in permits for structures of 5-or-more units to a rate 44 per cent above the rate at the end of 1962. Stock market credit. Customer credit in the stock market in December fell $96 million from the November peak to $7.2 billion at the end of 1963. This decline reversed an almost continuous increase in the use of customer credit amounting to about 50 per cent since July 1962. In early November, margin requirements had been raised from 50 to 70 per cent. A $15 million increase in bank loans to other than brokers and dealers for purchasing or carrying securities (except U. S. Governments) only partially offset a decline of $111 million in customers' debit balances (excluding U. S. Government securities). Money borrowed by member firms of the New York Stock Exchange (except on U. S. Government securities) declined $13 million, and customers' free credit balances fell $9 million. More detailed information on stock market credit in November and December is shown in the following table. End of Dec. 1 Customer credit Excluding U. S. Government securities - total 7 ,202 Net debit balances 5 ,475 Bank loans to "others" 1 ,727 26 Net debit balances secured by U. S. Govt, securities ""-Bank loans to "others" for purchasing or carrying U. S. Government securities 140 Broker and dealer credit Money borrowed except on U. S. Govt, securities On customer collateral Money borrowed on U. S. Government securities Customers' net free credit balances 4.,444 3.,849 32 1,,202 Month Change Nov. 7 ,298 5 ,586 1;,712 34 -96 -111 +15 -8 90 +50 4.,457 3.,892 28 1,,211 -13 -43 +4 -9. Stock prices. Common stock prices increased somewhat further on balance last week in very active trading. Prices, as measured by H. 14 Standard and Poor's composite index of 500 stock prices, closed at 76.56 on January 17, only slightly below the all-time high reached earlier in the week. Trading volume averaged 6.1 million shares a day, the highest since late November. CORPORATE SECURITIES SOLD DURING 1963 TO RETIRE OUTSTANDING SECURITIES Corporations took advantage of the relatively low level of interest rates prevailing during most of 1963 to refund a substantial volume of previously-issued high-coupon bonds. Net proceeds of corporate security sales for refunding last year totaled $1.5 billion, twice the previous year's total and the largest volume since 1954. This refunding represented primarily financing of electric and gas utilities and, to a lesser extent, of American Telephone and Telegraph Company and its subsidiaries. The bulk of the refinancing took place in the first half of 1963 when $1.1 billion in securities to retire outstanding issues were sold. After mid-year, yields began to rise and the advantage to refunding many high-grade securities began to disappear. As a result, refinancing dropped off in the last half of the year to around $0.5 billion, one-tenth less than in the corresponding period of 1962 when refunding was increasing. Detail for public offerings. Nine publicly-offered bond issues were sold during July-December last year to raise funds to retire $203 million in outstanding securities.* (For details on refunding issues sold in the first half of 1963, see Capital Markets Developments in the United States for the week of July 8.) The table on the following page presents details on each of these new issues and on the issue, or issues, which their proceeds were used to refund. Issues are grouped into two categories: Group A--amounting to $159 million—is comprised of issues refunded primarily to reduce interest costs, while Group B—totaling $44 million—includes issues refunded for other reasons. All the issues refunded to reduce interest cost were sold in the years 1957, 1959 or 1960 when yields on new issues were appreciably higher than during this recent six-month period. The issues sold in the latter two years probably could not have been refunded at lower costs until 1962. Of the two issues sold in 1957, the Michigan Wisconsin Pipe Line Co. bonds could probably have been refunded in 1958 at even greater interest savings than last year, but restrictions in the indenture of the Southern Bell Telephone Co. bonds prevented refunding that issue prior to late 1962. */ Most of the remaining $280 million of securities sold to refund outstanding securities were private placements for which available information does not permit detailed analysis. -4- H. 14 Issuers were able to place issues in Group A at rates that ran 57 to 122 basis points lower than those on the issues they were to refund. The difference in interest costs between the refunded issue and the issue refunded, however, does not measure the interest savings to the issuer because most issues are callable only at a price above par. The effect of call prices on total interest savings in a refunding operation can be illustrated by the $70 million Southern Bell Telephone Co. refunding. This issuer was able to place its new issue at 57 basis points lower cost than the issue it refunded, but the latter had a call price of 106.32 payable to holders. This was equivalent to roughly 27 basis points a year on the refunded issue, so the net interest savings on the refunding amounted to about 30 basis points, or roughly $4.8 million to the original redemption date of the old issue (in addition maturity was extended 17 years). Both issues in Group B replaced securities about to mature at higher interest costs. More detailed information concerning recent capital market developments is presented in the attached exhibits. Capital Markets Section, Division of Research and Statistics, Board of Governors of the Federal Reserve System. H.14 -5New Corporate Bond Issues Sold During the Second Half of 1963 for the Purpose of Refunding Outstanding Securities Date Sold Issuer Group A: Sierra Pacific Power Co. To refund: Michigan Wise. Pipe Line Co. To refund: Southern Bell Tel. Co. To refund: Jersey Central Pwr. & Lt. Co. To refund: Wisconsin Public Service Co. To refund: ,,Brockton Edison Co. To refund: Puget Sound Pwr. & Lt. Co. To refund: Type Ma turity of issue Coupon rate Cost to issuer (in per cent) Call price Sold Primarily to Reduce Interest Cost Deb. Deb. 1993 1985 5 5-5/8 4.89 5.57 106.87 30.0 24.6 70.0 70.0 1st mtg. bds. 1st mtg. bds. Deb. Deb. 1983 1977 2003 1986 4-7/8 6-1/4 4-3/8 5 4.77 5.99 4.34 4.91 106.32 10/63 5/60 18.5 8.5 1st mtg. bds. 1st mtg. bds. 1993 1990 4-1/2 5-3/8 4.46 5.26 107.20 10/63 10/59 10/63 6/59 11/63 10/59 4/60 15.0 7;8 5.0 5:0 40.0 20:0 20.0 1st 1st 1st 1st 1st 1st 1st 1993 1989 1993 1989 1993 1989 1990 4-3/8 . 4.39 5-1/4 5.19 4-1/2 4.48 5-1/4 5.22 4-5/8 4.65 5-1/2 5.49 5-3/8 5.36 106.30 105.85 1988 1964 4-3/4 4-1/2 4.81 4.61 100.00 1983 1963 4-5/8 3 4.53 2.96 100.00 7/63 7/60 8.0 3.0 7/63 6/57 8/63 6/57 Group B: Atlantic Coast Line Railroad Co. To refund: Public Service Electric & Gas Co. To refund: Amount (millions of dollars) mtg. mtg. mtg. mtg. mtg. mtg. mtg. bds. bds. bds. bds. bds. bds. bds. -* 106,74 106.07 105.88 Sold Primarily for Other Reasons 9/63 4/27 10/63 11/48 20.0 8.1 40.0 36.0 1st mtg. bds. gen. mtg. bds. Deb. Deb. 1 LONG-TERM B O N D YIELDS, H I G H - G R A D E STAJi AND 10CAI GOVtRHMENl Ae III Exhibit A - Part II S t a t e and Corporate Aaa 1/ U . S. Govt, l o n g - t e r m 2/ local government Spread between U. S. Govt, Corporate A a a 3/ and S t a t e and local Aaa (per c e n t ) 1958 - Low 1959-60 - High 1960-61 Low 1961 1962 1963 - High - Low - High Low 3 . 5 5 (5/2) 3.07 4 . 6 1 (1/29/60) 4 . 4 2 4 . 2 1 (3/17/61) 3 . 7 0 4 . 4 6 (9/15) 4.07 2 . 6 4 (5/1) .22 3 . 6 5 (9/24/59) 2 . 9 9 (9/2/60) .59 .92 (5/12/61) .19 .46 (12/29) 3 . 3 7 (7/6) .57 .30 .76 (4/25) (1/8/60) .34 .80 4 . 2 3 (12/28) 4.37(12/27) 3 . 8 5 (12/28) 4.16(12/27) 2 . 8 8 (11/8) 3.18(11/21) .35 1.05 4.19(3/29) 3.87(1/18) 2.93(3/28) .21 .89 1.04 Dec. 20 4.36 4.15 3.11 .21 Dec; 27 4.37 4.16 3.11 .21 Jan. 3 4.37 4.15 1.04 10 4.37 4.16 3.11 3.11 .22 Jan. .21 1.05 4.38 4.16 3.10 .22 1.06 ,/Jan. 17 £ / 1.05 n/ Preliminary. is 22-24 years. y Vfeekly average of daily figures. Average t e r m of tends inolud The series includes bonds due or callable in 10 years or more* y Weekly average of daily figures, 3 / Thursday figures. Only general oDiigaxion b o m s are inoi.uaeaj average tern is zu years B o t e . — H i g h s and lows are f o r individual series and may be on different dates f or different series, for spreads, high refers to widest, and low to narrowest. if " L O N G - T E R M B O N D YIELDS, L O W E R - G R A D E V - LJ-.l_L_Ll_l_i.i_J-1-1J -Ll_l_l. I.J.I L I I MJ Exhibit B - Part II Corporate Baa 1/ State and local govt. Baa 3/ 4 . 5 1 (7/11) 3.64 Spread between Aaa and Baa State and Corporate local govt. (per cent) 1958 - Low 1959-60 - High 1960-61 Low 1961 - High 1962 - Low 1963 - High Dec. Dec. Jan. Jan. v-Jan. Note» 20 27 3 10 17 £/ 5 . 1 3 (10/27) 4 . 1 6 (3/23) 4.92 (1^21) 4.93(1/4) 4.83(11/15) 3.63(6/27) 3.52(5/23) .77 .84 .66 .81 .63 .71.47 4.85 4.85 4.84 4.84 4.84 z 3.62 3.60 3.56 3.57 3.56 .49 .48 .47 .47 .46 (5/1) 5.36 (2/12/60) 4 . 4 6 (3/7/60) 4 . 9 8 (9/9/60) 3,-93 (11/9/61) For footnotes see Exhibit A. 3 . 5 2 (5/17) .93 1.08 .57 .93 .56 .63 .44 .51 .49 .45 .46 .46 SHORT- AND INTERMEDIATE-TERM INTEREST RATES/ G O V E R N M E N T Exhibit C ^ Part II Date Discount rate 3-month bills 2/ Yields 6-month bills 2/ (per cent) 3-5 year issues 2/ Spread between yields on 3month bills and yields on 6-mo. bills 13-5 vr. issues 1958 - Low 1959-60 High 1960-61 Low 1961-62 High 1962 - Low 1963 - High Low 1.75 4.00 3.00 3.00 3.00 3.50 3.00 .58 4.59 (5/29) (1/8/60) 2.11 (10/28/60) 2 . 3 5 (4/28/61)3.15 (5/12/61) .12 2.97 (7/13/62) 2.65 (6/8) 3.55(11/15) 2.88(3/15) 2.74 (6/8) 3.68(12/6) 2.93(3/8) 3.41 (12/28) 4.07(12/27) 3.44(1/18) .44 .02 .17 .04 .04 1.81 .38 1.51 .52 .70 .42 Dec. Dec. Jan. Jan. Jan. 3.50 3.50 3.50 3.50 3.50 3.53 3.52 3.52 3.53 3.54/ 3.67 3.65 3.65 3.66 3.65 4.06 4.07 4.08 4.08 4.07 .14 .13 .13 .13 .11 .53 .55 .56 .55 .53 20 27 3 10 17 £./ 1/ 2/ 3.02 (12/26) 2.14 (6/6) 5.07 (3/8/60) 5.00 (12/24/59) 3 . 1 3 (7/20/62)3.88 (2/2/62) ' .26 .79 Weekly rate shown is that in effect at end of period at the Federal Reserve Bank of New York. Maricet yield; weekly averages oonputed from daily 0losing bid'prices. Series of 3-5 year issues consists of selected notes and bonds. liote.—Highs and lows are for individual series and may be on different dates for different series. For spreads, high refers to widest, and low to narrowest. .Y> U H i m t 6, PaiI 1 S H O R T - A N D I N T E R M E D I A T E - TERM INTEREST RATES, BANKS AND OTHER PRIVATE BORROWERS STOCK l l t H m i CAll I 0*M$ HHANCt COMPAHY PAMB I y Ploc • d 3-6 Month DISCOUNT RATI -IW -y*" I U6IBAI fUH8$ I I I I I I f»tl / 1942 Exhibit D Date Stock Exchange c a l l l o a n 1./ Prime rate 1 / - Part II Finance company paper 2/ Federal f u n d s 3/ Spread between 3 - m o . b i l l s and finance co. p a p e r (per cent) (5/29) -.35 4.00 (5/13/60) 1.02 .43 (1/27/61) .11 (12/28/62) .56 3.50 3.50 1 . 1 3 (8/8) 1959-60 - High 5.50 5.00 5 . 1 3 (1/22/60) 1960-61 Low 4.50 4.50 2 . 5 0 (8/5/61) 1961-62 - High 4.50 4.50 3 . 2 5 (7/20/62) 3-00 1958 - Low 4.50 .13 .19 .36 1962 - Low 1963 - High 4.50 4.50 2 . 8 8 (6/1) 3.88(12/27) 1 . 3 0 (1/26) 3.50(12/27) Low 4.50 4.50 3.13(5/31) 2.45(7/26) .09 4.50 4.50 3.88 3.50 .35 Dec. 20 ,4.50 Dec, 27 3.88 3.50 .36 3 10 4.50 4.50 4.50 Jan. Jan. 4.50 3.88 4.50 4.50 3,88 3.44 3.50 .35 Jan. 1 7 j>/ 4.50 4.50 3.88 3.50 .34 .36 rfeekly rate shown is that in effect at end of period. Stock Exchange call loan rate is going rate on call loans secured by ouetcmera' stock exchange collate m l at New York City ban)®.. Prime rate is that charged by large banks on short-term loans to business borrowers of toe highest credit standing* 2/ Average of daily rates published by finance companies for directly placed ptpcr tor Vfcjying maturities in the 90-179 day range. 3/ Weekly average of daily effective rate, which i» the rate for the heaviest w l u m e of purehaes and sale transactions as reported to the Federal Reserve Bank of New York. N o t e . — H i g h s a n d lows a r e for individual series and m a y be on different dates f o r different eeriei. Tor sprsads, high refers to widest, and low to narrowest. EXHISH E. Port I STOCK MARKET Exhibit B - Part II Date Stock price index 1/ Common . Trading Stock m arket customer credit volume 3/ Customers 1 Bank yields 2/ (millions Total debit bal- loans to (per cent) of shares) ances 4/ "others" 5/ (In millions of dollars) 1961-62 - High Low 1963 - High Low 72.04(12/8/61) 52.68 (6/22/62) 74.44(12/27) 64.10(3/1) 2.82 3.96 3.01 3.36 10.1 2.4 November December Jan. 3 Jan. 10 Jan. 17 ]>/ 72.62 74.17 75.50 76.24 76.56 3.14 3.13 3.09 3.06 3.05 5.2 4.7 5.4 5.4 6.1 6.4 3.2 5,602(12/61) 4,259 (12/61) 1,377(8/30/61) 4,876(7/62) 3,562 (7/62) 1,269(9/26/62) 7,298(11/63)5,861(11/63)1,738(12/25) 5,595(1/63) 4,208(1/63) 1,378(2/23) 7,298 7,207 5,586 5,475 1,712 1,727 1,727 1,729 n.a.—Jlot available, jj/ Preliminary, Standard and Poor's composite index of 500 ooranon stocks, weekly closing prices, 1941-43»10. Monthly data are averages of dally figures rather than of Friday's only. Highs and lows are for Friday's data only. 2/ Standard and Poor's composite stock yield based on Wednesday data converted to weekly closing prices by Federal Reserve. Yields shorn are for dates on which price index reached its higi 3/ Averages of daily trading volume on the New York Stock Exclange. AJ find of month figures for member flans of -fee New York Stock Exchange vfcioh cany nargLn accounts; excludes balances secured by U. S. Government obligations. 5/ Wednesday figures for weekly reporting member banks. Excludes loans for purchasing or carrying U. S Government securities. Prior to July 1, 1959, such loans are exclvded only at banks in «ew York and Chicago. Weekly reporting banks account fbr a tout 70 per cent of loans to other*. For further detail see Bulletin. v V PRIVATE H O U S I N G STARTS A N D PERMITS S E A S O N A L L Y A D J U S T E D DATA I IUIIDING Pmills PER C E N T O F U N A D J U S T E D TOTAL S T A R T S • ULIIfAMIlY „„ m o 1962 E x h i b i t F - P a r t II Start! Building Unadjusted permits T y p e of financing T y p e of housing ( s e a s o n a l l y S e a s o n a l l y adjustadjusted 1-2 MultiUnadjusted ed a n n u a l r a t e annual Other FHA VA family family r a t e ) 2/ Total 1962 - D e c . 1963-Jan. Feb. Mar. Apr. May July Aug. S e p t . r/ Oct. r/ N o v . r/ 1,562 1,344 1,380 1,575 1,618 1,618 1,571 1,588 1,455 1,732 1,847 1,556 1,597 (Thousands of u n i t s ) 94 16 5 74 81 14 63 4 87 13 70 4 124 17 5 103 158 21 129 7 166 22 137 7 153 20 126 7 .... 1 5 0 21 8 121 144 19 119 7 145 19 6 120 163 21 6 136 119 17 5 96 97 15 5 77 60.1 50.1 56.0 84.9 111.1 112.6 104.7 r/103.0 r/100.5 97.5 33.8 30.5 30.6 39.5 47.0 53.8 . 48 .7 r/47.1 r/43.8 47.8 1,248 1,200 1,193 1,232 1,214 1,285 1,315 1,256 1,215 1,319 1,367 1,321 1,434 V Total starts are Census estimates including faro for both permit-Issuing and non-issuing areas. A dwelling unit is started when excavation begins | all units in an apartment structure are considered started at that time. IHA and VA starts are units started under oomnitments by these agencies to insure or guarantee the mortgages. As reported b y FHA art VI, a unit is started when a field office receives the first oonpliance inspection report, which is made before footings are poured in some oases but normally after the foundations have been completed, Capehart military housing units are excluded. Other starts are derived as a residual, although total and iEA and VA starts axe not strictly comparable in concept or timing) other starts include both unite financed by conventional mortgages and units without mortgagee. U areCensus estimates for all of the approximately 10,000 areas in the United States which were identified a t having a local building permit system in 1959. Unlike starts, seasonally adjusted building permits reflect & direct measure of the influence of changes in the number of working days per month, along with otUmmp fefferenoes in timing and coverage. YIELDS O N NEW AND SEASONED CORPORATE BONDS Exhibit 6 - Part II Yields on New Corporate Bond leaves Adjusted to an Aaa basis Number Am't of issues Average of included (mil. yield (per cent) of dollars) Weekly averages: 1963 - Aug- 16 23 30 Sept. 6 13 - 20 27 Oct. 4 11 18 25 Nov. 1 • 8 15 2 1 1 1 2 50.0 12.0 : 15.0 100.0 33.5 — — 1 2 1 1 Nov. 22 29 6 13 20 27 1964 •• Jan. 3 10 17 4.33* 4.35 Dec. 4.34 4.34 4.32 -- — 40.0 75.0 30.0 22.0 4.37 4.35 4.41 4.21* Number Am't of issues Average of included (mil. yield (per cent) of dollars) 4 115.0 4.42 2 2 1 60.0 95.0 150.0 4.41 4.45 4.54* -- 1 1 — 130.0 5.0 4.50 4.44* ' 10to l A v e r a g e s ox oixerxng yxeXQO an ell#, new i b b u o b oj. puuj_iuj.y o i i e r c a oozp orate oonao rateo jvsa. Jia ana A by Moody's Investor# Senrioe (except serial and convertible issues, offerings of natural gas pipeline and foreign companies, and bonds guaranteed by the Federal Government) weighted by aize of offering* Before averaging, new offerings are adjusted to a composite Aaa basis by deducting from the actual reoffering yield the excess of the weekly average yield f o r seasoned bonds of the appropriate industryquality group over the composite average for seasoned Aaa-rated bonds (Moody's), Averages considered unrepresentative because at special characteristics of ihe offerings included are denoted by an asterisk^ I VI H. 14 Exhibit H Long-term Corporate and State and Local Government Security Offerings and Placements (In millions of dollars) New Capital Corporate 1/ 1964 1 1963 e/ January February March 850 April May 1964 613 594 1,144 592 859 807 e/ 900 930 904 1,013 1,113 760 1,132 £/ 582 749 579 676 667 795. July August September State and Local 2/ 1962 1 1963 1 1962 1 £/ £/ £/ 732 726 974 876 1,133 628 £./ £/ 866 861 945 873 912 786 £/ £/ £/ 647 706 447 612 544 427 October November : '>ec ember £/1,062 £/ 830 e/1,282 835 703 1,103 £/l,103 £/ 639 e/ 400 650 578 550 1st 2nd 3rd 4th 2,351 2,847 < 2,138 a/3,174 2,258 3,005 1,910 2,641 2/2,431 2/2,672 £/l,800 e/2,142 2,637 2,571 1,582 1,779 5,198 7,337 e/10,510 5,264 7,173 9,814 £/5,103 £/ 6,903 e/9,045 5,208 6,790 8,568 quarter quarter quarter quarter 1st half Three quarters Year Excluding finance companies 3/ 1st 2nd 3rd 4th- quarter quarters quarter quarter Year e/ £/ 1/ 2/ 3/ ' 2,284 2,529 1,797 e/2,674 2,199 2,919 1,775 2,410 e/9,284 9,303 Estimated by Federal Reserve. Preliminary. Securities and Exchange Commission estimates of net proceeds. Investment Bankers Association of America estimates of principal amounts. Total new capital issues excluding offerings of sales and consumer finance companies. . f H. 14 New Corporate Security Issues, Type of Issue and Issuer (In millions of dollars) Quarter or Month ; 1961 - I II III IV 1,992 5,352 2,566 3,236 : 1962 - I II III IV 2,378 3,250 2,184 2,957 1,155 1,389 853 1,089 716 1,222 1,024 1,568 507 639 307 300 I1 1 |l963 - I II III IV e/ 2,700 3,634 2,466 3,415 1,108 1,389 898 1,286 1,306 1,820 1,281 1,771 |l962 - Apr. May 1,217 801 1,232 630 922 632 976 784 1,197 654 247 488 200 477 176 539 286 264 695 642 1,363 1,049 1,340 1,246 810 786 871 1,170 904 1,341 350 259 499 380 550 459 279 336 283 511 205 570 ?• 1 I July Aug. Sept. Oct, Nov. Dec. 1 July Aug. Sept. Oct. £/ Nov. £/ Dec. e/ •s "1963 - Jan. Feb. Mar. Apr. May . Total Gross proceeds for new capital and refunding 1/ Common Memo: B and foreign Publicly Privately issues pfd. offered offered included stock 662 880 76 449 2,303 1,275 1,774 155 772 1,139 654 69 967 1,424 62 845 Net proceeds for new capital 1/ 2/ Mfg. Public Communi- Other utility cations is- 515 1,466 935 792 381 1,081 595 836 81 1,095 104 147 832 1,052 893 1,263 68 257 56 179 655 996 601 769 430 983 375 568 456 231 275 321 717 794 659 986 287 424 287 357 128 434 109 n.a. 947 591 806 884 326 794 285 505 236 221 150 123 842 1,241 | 897 1 1,662 227 420 575 366 363 295 314 446 808 336 134 169 67 82 161 123 52 125 10 147 100 13 43 46 34 99 384 270 342 217 218 166 153 271 345 . 377 196 410 118 110 148 141 175 252 88 64 79 88 120 67 260 4 57 264 229 301 ( 159 1 301 199 282 253 451 243 289 774 452 694 675 431 349 501 532 542 697 102 94 91 217 95 113 100 100 87 127 157 73 25 43 60 56 182 196 46 21 42 7 8 n.a. 135 220 592 148 216 227 297 272 237 266 224 394 114 115 97 341 222 230 107 100 78 198 130 177 125 68 43 71 92 58 86 24 39 42 13 68 238 191 412 369 373 499 187 270 441 556 463 643 1 (1964 - Jan. $ Feb. Mar. "_/ Preliminary, e! Estimated by Federal Reserve. 1/ Gross proceeds exceed net proceeds ^ y the cost of flotation. 2/ For total see Exhibit Hj other issuers are extractive, railroad 3 i other transportation, real estate and finance and commercial and other. Source. "Securities and Exchange Commission. H. 14 Other Security Offerings (In millions of dollars) 1964 Gross lonz-te rm 1/ Foreign government 2/ . | 1963 | 1962 1964 January February ^March April May July August September October November December Year January February March April May July August September October November December Year 232 133 76 57 114 11 63 83 £/ - E/ 1/ -__ -- e/ 769 Federal agency 3/ 1962 1963 I 148 246 156 186 461 142 10 35 10 86 50 25 8 31 151 88 101 E/174 2/200 e/ -- 737 e/1,167 Net Short-terra 4/ State and local government 5/ 75 18 272 466 -367 -186 127 589 -30 -84 -10 -118 62 78 339 208 -406 -173 259 71 234 146 -161 £/-346 £/ 685 | 378 459 150 175 ---- 1 ,188 Federal aeencv 3/ -106 247 -189 -156 226 -482 -364 292 82 195 284 319 261 414 227 327 -157 258 123 379 55 -102 -80 £/ 545 P/1,594 1 ,004 2/ Preliminary, e/ Estimated by Federal Reserve, n.a.--Not available. 1/ These data differ from those in Exhibit H in that refunding issues, as well as new capital issues are included. Long-term securities are defined as those maturing in more than one year. j> 2/ Includes securities offered in the United States by foreign governments and their ' political subdivisions and international organizations. Source: Securities and Exchange Commission. 3/ Issues not guaranteed by the U. S. Government. Source: long-term, Securities and Exchange Commission; short-term, Treasury Department and Federal Reserve. I 4/ These data differ from those in Exhibit H and above in that they represent new offerings less retirements, whether from the proceeds of refunding issues or from other funds. Data include only issues with original maturity of one year or less. 5/ Principally tax and bond anticipation notes, warrants or certificates and Public Housing Authority notes. In some instances PHA notes included may have a somewhat longer maturity than one year. Source: Bond Buyer and Federal Reserve. Exhibit K Large Long-term Public Security Issues for New Capital (Other than U. S. Treasury) 1/ Proceeds of Large Issues Offered (In millions of dollars) Month 1962 - December 1963 - January February March April May June July August September October November December Corpora t< Bonds Convertible (Other than bonds convertibles) Total State and . local government 20 178 215 125 372 263 149 348 180 218 215 380 117 515 198 234 186 394 409 149 348 199 236 237 446 180 547 Stocks 193 344 367 570 431 389 372 279 329 135 743 373 111 19 26 22 146 35 19 18 22 66 63 32 --- Other 2/ 75 48 63 134 43 460 60 20 174 200 . : Large Individual Issues Offered January 1 through 17 Issuer Type Amount (millions of dollars) Maturity Coupon rate or net interest OfferRating ing yield CORPORATE General Amer. Transp. Corp. New York Tel. Co. Transcontinental Gas P. L. Corp. Equip, tr. cert. Deb. 1st. mtg. p.l. bds. 40.0 130.0 1984 2004 4-5/8 4-5/8 4.59 4.53 40.0 1984 4-3/4 4.82 1965-90 1970-84 1964-2004 1964-84 2004 n.a. 3.44 3.36 3'96 2. 10-3.35— Aa 2.'75-3.47 A 1. 90-3.50 Aaa 2" 80-3.60 3. 95 16.0 1965-84 3.00 2. 00-3.10 Aa 11.8 1965-2004 3.88 2. 25-3.90 A A Aaa - Baa STATE AND LOCAL GOVERNMENT - State of California G.O. ,Alabama Highway Auth. Rev.-Q.Ut. j Public Housing Auth. -Rev.-Rent. Toledo Lucas Co. Port Auth., Ohio Rev.-Rent. St. Louis Met. Swr. Dist., Mo. G.O. Greater Johnstown Wtr. Auth., Pa. Rev.-Ut. r OTHER „ None 80.0 15.0 140.3 18.9 46.9 : '5 H.14 K-2 Footnotes *—Rights offering. n.a.r-Not available. 1/ Includes corporate and other security offerings of $15 million and over; State and local government security offerings of $10. million and over. 2/ Includes foreign government and International Bank for Reconstruction and Development issues and non-guaranteed issues by Federal agencies. "3/ In the case of State and local government securities, G.O. denotes general obligations; Rev.-Ut., revenue obligations secured only by income.from public utilities; Rev.-Q.Ut., revenue bonds secured only by revehue from quasi-utilities; Rev.-S.T., revenue bonds secured by revenue from specific taxes only; Rev.-Rent., revenue bonds secured solely by lease payments. —/ 1/20 pet cent bonds due 1989 arid 1/4 iper"1 cent bonds due 1990 not publicly reoffered. If H. 14 Exhibit L Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U. S. Treasury) 1/ Expected Proceeds from Forthcoming Large Issues During month following date shown State and Corporate local govt. Date of computation 1962 - Dec. 1963 - Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. ; 28 31 28 29 30 31 28 31 31 30 31 29 31 177 376 458 381 447 255 142 329 210 561 255 137 469 269 167 142 376 149 223 170 221 158 240 145 392 305 Other 2/ Silbsequent to <iate shown State and Corporate local govt. 25 45 40 460 75 20 314 412 572 421 234 288 215 267 183 240 145 1 ,992 1 ,905 Other 2/ 311 843 755 763 599 582 287 512 468 757 401 349 731 25 33 45 40 460 75 20 Forthcoming Large Offerings , as of January 17 Type Issuer CORPORATE Pan American World Airways Texas Pwr. & Lt. Co Potomac Elec. Pwr. < Co. American Tel. & Tel . Corp. STATE AND LOCAL GOVERNMENT •Dallas, Texas New York City, N.Y. Philadelphia Sch. Dist., Pa. Duval Co. Spec. Tax Sch. ; Dist. No. 1, Fla. '^Commonwealth of Massachusetts Commonwealth of Puerto Rico j State of Delaware >*Milwaukee, Wisconsin *Chesterfield Co., Va. *Milwaukee Co., Wisconsin Penna. Gen. State Auth. Alabama State Docks Dept. Pittsburgh, Pa. Conv. sub, deb. S.F. deb. Com. stk. Com. stk. G.0. G.O. G.0. Rev.-S.T. G.0. G.O. G.O. G.O. G.O. G.O. Rev.-Rent. Rev.-Q.Ut. G.O. Amount (millions of dollars) 60.0 15.0 21.7 1,600.0 Approximate date of offering January 22 (rts. ex.) January 22 January 23 (rts. ex.) April (rts. ex.) 12.0 114.4 15.0 January 20 January 21 January 22 10.0 33.4 53.0 24.8 15.6 11.5 12.1 50.0 10.0 35.0 January 28 January 28 January 29 February 4 February 4 February 5 February 18 February 18 February 27 Indefinite H. 14 L-2 Forthcoming Large Offerings, as of January 17 (Cont'd.) Type STATE AND LOCAL GOVERNMENT (Cont'd.) Dade County, Florida Jacksonville Expressway Auth., Fla. Houston, Tex. Amount (millions of dollars) Approximate date of offering G.O. 46.0 Indefinite Rev.-Ut. G.O. 40.0 11.1 Indefinite Indefinite OTHER * 1 ! ^--Included in table for first"time. 1/ Includes corporate and other issues of $15 million and over; State and local government issues of $10 million and over. 2/ Includes foreign government and International Bank for Reconstruction and Development issues and non-guaranteed issues of Federal agencies. x te.--Deletions for reasons other than sale of issue: None. H.14 Exhibit H Foreign Government and Corporate Security Offering# and Placements in the United States • Part I: Sale Date Amount (millions of dollars) Issuer and Description rof Issue A. Sold November 1 through January 17 "Province of Sante Fe, Republic of Argentina - 7% Treasury bonds, maturing 1969, offered to yield 9.45% 12/24 B. 2/2? Public Offerings 7.5 Prospective Offerings TObos de Acero de Mexico, S.A. convertible debenture M-2 Part II: Date reported H. 14 Private placement—Reported November 1 through January 17- Amount (millions of dollars) Issuer and Description of Issue 11/27 15.0 Home Oil Co., Ltd.--6-1/47. collateral trust bonds, . maturing 1983, placed at par—no information available on takedown 1/7 14.0 Laurentide Financial Corp., Ltd.--5-1/4% collateral trust rute;s .maturing 1989--no information available on take- No te: For retrospective data on aggregate foreign corporate and government security offerings in the United States see Exhibits I and J. There is no simple relationship between the data shown in this Exhibit and that shown in Exhibits I and J because the latter includes privately placed securities in the period in which funds are , actually takendown but only in the amount o f takedown, while the placements shown in this exhibit are included when reported, frequently with little or no information concerning timing of takedowns. Full or partial takedowns may take place both prior and subsequent to the date a placement is reported. *—Included in table for first time.