Full text of H.16 Capital Market Developments : June 8, 1970
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• E B G o m o H H ) iras. sis m a m L.5.8 • . Confidential (F.R.) _ • ' . . . /CAPITAL 'MARKET DEVELOPMENTS Capital Markets Section, Division of Research and Statistics, Board of Governors of the Federal Reserve System, Washington, D. C. JUNE 8 , • 1970 / INDEX 3-5 Developments in the Corporate and Municipal Bond Markets 6-7 Capital Market Yields 8-13 Capital Market Volume 14-17 Stock Market 18-33 Mortgage Market SYMBOLS: e Estimate p Preliminary r Revised n.a. Not available TABLE 1: Yields, Volume and Reception WEEK ENDING: 1970 - May 1 8 15 22 28 June 5 12 YIELDS MOODY'S -SEASONED 1 NEW ISSUE Aaa CORPORATE BOND MARKET VOLUME 2 • ! PER CENT SOLD BY END BONDS SCHEDULED . GROSS OFFERINGS . OF WEEK WITHIN 28 DAYS 8.91 8.98 9.10 9.05 9.20 7.92 7.99 8.09 8.16 8.21 195 345 610 284 222 99 100 97 62 96 9.05 n.a. 8.30 261 45 Oe n.a. « 2,717 2,636* 2,385* 1,044 819 1,069 * WEEK ENDING: 1970 - May June YIELDS MOODY'S BOND BUYER SEASONED SEASONED 20 Aaa BOND INDEX MUNICIPAL BOND MARKET VOLUME 2 PER CENT GROSS SOLD BY END • OF WEEK OFFERINGS 1 8 15 22 28 6.50 6.55 6.70 6.74 6.80 6.79 6.89 6.96 7.02 7.12 196 113 319 250 245 5 12 E / 6.75 6.92 90 300e . BONDS SCHEDULED WITHIN 28 DAYS 77 68 70 63 86 530 624 449 508 308 • . 69 6&8 n.a. 1 Derived by adjusting to a Aaa 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.) . * 2 Millions of dollars unless otherwise indicated. Note: * See footnotes to Table 3 AT&T rights offerings included in May estimate. * TABLE 2: Details on Inventories CORPORATE BONDS IN SYNDICATE END OF LATEST WEEK ORIGINALI • RATING AND YIELD CALL PROTECTION COUPON ISSUER ' AMOUNT (MIL. $) DATE OFFERED Kansas .City Power and Light Western Mass. Elec. . 35.0 30.0 6/4 6/3 9-1/8 9-3/8 9.05 9.27 ESTIMATED PROPORTION. SOLD 25 % 50 % Aaa 5 yrs. Aa 5 yrs. • ) \ • DATE OFFERED | RELEXSED : CORPORATE BONDS RELEASED FROM SYNDICATE DURING LATEST WEEK ORIGINAL INCREASE RATING AND ESTIMATED PROISSUER COUPON IN YIELD CALL PROT. PORTION RELEASED YIELD AMOUNT N O N E INVENTORIES 1 MUNICIPALS BLUE LIST | IN SYNDICATE DATE 1970 - May June 8 15 22 29 5^ 457 463 499 443 90 128 184 78 378 54 CORPORATES IN SYNDICATE 0 17 108 ' . 9 24 N.C. - No call protection. . . 1 All figures in millions of dollars. Blue List is daily average for week ended Friday, except for latest week which is daily average of three .days ended Wednesday. All•other figures are as of Friday. BONDS IN SYNDICATE Friday figures Millions of dollars CORPORATE BONDS IN SYNDICATE 200 100 ill MUNICIPAL BONDS IN SYNDICATE 300 200 100 SEPT. MAR. DEC. 68 JUN. 1969 ( i SEPT. DEC. MAR. JUN. 1970 SEPT. TABLE 3: High Grade Bond Yields r DATE MOODY'S SEASONED CORPORATE Aaa 2 NEW CORPORATE Aaa 1 U.S. GOVERNMENT 20-YEAR CONSTANT MATURITIES 3 ' BOND BUYER'S SEASONED MUNICIPALS 4 1968 - High Low 7. 02 (12/13) , 6. 13 (8/30) 6.55 (1/27) 5.95 (9/13) 5,90 (1/20) 5.18 (8/9) 1969 - High Low 8. 85 (12/5) 6. 90 (2/21) 7.84 (12/26) 6.55 (1/3) 6.97 (12/26) 5.96 (1/24) 1970 - High Low 9. 20 (5/29) 8. 20 (2/27) 8.30 (6/5) 7.79 (3/6) 7.55 (5/29) 6.60 (3/6) 7.12 (5/29) 5.95 (3/12) 1970 - May 15 22 29 9. ,10 9.,05 9, ,20 8.09 8.16 8.21 7.12 7.17 7.55 6.96 7.02 7.12 8.30 7.33 6.92 June 5^ 9. ,05 . 4.85 (1/26) 4.07 (8/8) - 6.90 (12/18) 4.82 (1/28) 1 New corporate'issues, with call protection., adjusted (as described in ' 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 gf the 20 bonds used in this index ' falls midway between the folir 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. " ' ' ' ' V '1 HIGH GRADE BOND YIELDS NEW CORPORATE Aaa MOODY'S CORPORATE Aaa U S. GOVT. 20-YR. CONSTANT MATURITIES BOND BUYER MUNICIPAL 1966 1967 1968 1969 1970 TABLE 4: Long-term Corporate and State and Local Government Security Offerings and Placements (In millions of dollars) GROSS PROCEEDS CORPORATE PERIOD 1970 1969 1 STATE AND LOCAL 2 1968 I 1970 1969 i i ; 1,338 1,212 1,499 1,262 987 538 1,178 1,158 1,404 l' ! 1,630 l,000e 1,000e 1,801 1,110 737 1,318 1,143 1,395 1,097 808 559 1,469 1,699 1,444 1,280 886 816 2,230 1,021 1,115 2,787 3,648 2,464 2,982 3,840 3,856 4,612 4,366 6,435 .8,899 11,881 7,956 12,008 16,574 January February March 2,601 1,830 3,400e 2,075 2,045 2,098 1,771 1,608 1,799. April May 3,000e 3,500e 2,800e 2,748 2,076 2,530 1,428 1,866 2,411 2,478 1,427 2,427 2,143 1,432 1,557 1,933 2,375 2,532 2,129 1,767 2,054 6,218 7,354 6,332 6,840 5,178 5,704 5,133 5,950 13,572 19,904 26,744 10,882 16,015 21,965 July ' August September October November December ' 1st 2nd 3rd 4th * Quarter Quarter Quarter Quarter 7,831e 9,300e •1st half Three quarters Year Excluding finance companies 3 1st '2nd 3rd 4th Quarter Quarter Quarter Quarter Year 1 2 3 Note: 6,170 7, 037 ; ^ J | | | • 4,049e/ 3,630e/ ' 1968 — 5,107 5,427 4,785 5,654 20,973 Securities and Exchange Commission estimates of gross proceeds. Investment Bankers Association of America estimates of principal amounts. Total gross proceeds excluding.offerings of sales and consumer finance companies. AT&T rights offering included in May estimate. TABLE 5: New Corporate Security Issues, Type of Issue and Issuer (In millions of dollars) QUARTER OR MONTH , GROSS PROCEEDS BY TYPE OF ISSUE COMMON AND BONDS MEMO: PUBLICLY PRIVATELY PFD. ' ISSUES INCLUDED MFG. OFFERED PLACED FOREIGN - |CONVERTIBLE STOCK TOTAL •r 1969 - I II III IV 1970 - I e/ 6,218 7,354 6,332 6,840 8,230 1969 - May June July . Aug. Sept. Oct. Nov. Dec. 1970 - Jan. Feb. Mar.e/ Apr.e/ May e/ 2,076 2,530 2,478 1,426 2,427 1,933 2,375 2,532 2,601 1,830 3,400 3,000 3,500 ' 2,657 . 3,411 3,186 3,479 4,968 871 1,272 1,279 . 685, 1,222 969 1,164 1,346 1,594 1,068 1,900 2,000 3,000 . 1,540 . 1,673 1 ,347 1 ,053 1 ,092 510 514 609 259 479 313 226 514 485 ' 292 400 4bo 300 2,023 2,268 1,797 2,307 2,170 215 227 x 289 115 n. a. . 694 744 589 482 726 651, i 984 672 522 470 1,100 600 200 28 137 132 122 35 59 8 48 60 33 n. a. n.a. n.a. 1,355 1,126 750 809 929 . 463 233 214 167 369 105 303 401 387 249 250 . ,330 200 GROSS PROCEEDS BY ' TYPE OF ISSUER ! "7i 1 COMMl/NI - 1 OTHER PUBLIC UTILITY I CATIONS' 1 i .ISSUERS1 1,,407 1,,773 I:,862 1,,314 2,,671 569 691 875 362 625 260 453 601 787 371 1 ,500 800 850 • Other issuers arc extractive, railroad and other transportation, real estate and finance, and commercial and other. Source: . Securities and Exchange Commission. Quarterly supplements are available. . ' '1 1.,346 L ,878 L ,544 1:,967 2;,320 392 702 493 507 544 745 622 600 639 540 820 960 .450 473 432 684 598 511 197 191 286 126 272 120 201 277 229 • 226 260 25 1,800 2,993 3,266 2,243 2,961 - 2,729. . 915 946 826 433 984 808 1,099 1,054 947 694 820 1,215 400 TABLE 6: Large Long-term Public Security, Issues for New Capital . (Other than U.S. Treasury) 1 p 1 thror gK V 1SSUKR TYPE 2 AMOUNT (MILLIONS OF, - DOLLARS) Corporates Scott Paper Co. Central Hudson Gas & Elec. Co. -Mapco Inc. Western Mass. Elec. Co. Western Mass. Elec. Co. American Natural Gas Co. Tampa Elec. Company *General Public Utilities Corp Kansas City Power & Light Co. Tampa Electric Co. Chase Manhattan Mortgage & Realty Trust Chase Man. Mtg. & Realty Trust, V Debs. 1st Mtg. Debs 1st Mtg. Pref. Stk. Com. Stk. Pref. Stk. Com. Stk. 1st Mtg. Pref. Stk. Cony. Sub. Debs. Benf. Int. MATURITY •'COUPON . RATI: OR NK'i l.vri'k" I'.ST COST 1Q7Q MOODY'S 0F4-ERING : -..RAT INC, . YIHLI) ' 100.0 25.0 23.0 30.0 15.0 38.2 15.0 24.6 35.0 15.0 40.0 60.0 / 2000 2000 1975 2000 8.88 9.38 11.00 9.38 8.90 9.33 11.00 9.28 2000 9.13 9.05 Aaa 1990 6.75 6.75 N.R. Aa Aa Ba Aa i TABLE 6: Large Lontj term Public Security Issues for New Capital (contimn d; (Other than U.S. Treasury)' ISSUER TYPE 2 1 COUPON RATE OR -MTKR- ' MOODY'S MATURITY | NET INTERi:.( j RATING 1 EST COST | VILLI) AMOUNT (MILLIONS OF DOLLARS) State and Local None Other None * * 1 . * •? Rights offering. Includes corporate and other security offerings of $15 million and over; State and local security offerings of $10 million and over. 2 In case of State and local government securities, G.O. denotes'genera 1 obligation; '<ev. -''t. , revenue obligations secured only by income from public ui i 1 i ti vs; Rev.-Q.-lit., revenue bonds secured only by income from quasi-utilities; Rev.-S.T., revenue bonds secured by revenue from specific taxes only; Rev.-Kent., revenue bonds secured solely by lease payments. , 3 Includes foreign government and International Bank for Reconstruction and , Development issues and non-quiranteed issues by Federal Agencies. TABLE 7: Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U.S. Treasury) 1 As o f June 5, 1970 (continued) ISSUER TYPE . AMOUNT (MILLIONS OF DOLLARS) APPROXIMATE DATE OK .OFFERING ' Corporates Debs. General • Telephone of Calif. Bonds West. IVnn Power S.F. Debs. P.P.C. Industries Debs. Lone Star Gas Co. Raybi.-s.tos. - Manhattan, Inc. Debs. Consumer Power Co. Com. Stk. Debs. *Pemiwalt Corp. *M.ivh. Consolidated 1st Mtg. Bonds Appalachian Power Co. New Jersey. Hell Telephone Co , Debs. burl i ngton Northern Bonds *Dayton Hudson Debs, Notes R.C.A. Corp. S.F. Debs. R.C.A.-Corp. .*SVnith Carolina Elec. & Gas Bonds. 70 .0 25 .0 125 .0 30 .0 25 .0 40 . 0 * 40 .0 30 .0 70 .0 100 .0 60 .0 25 .0 75,.0 75,.0 30,.0 Consumer Power Co. 60,.0 1st Mtg. *Pul1mari Transp. Leasing Co. Equip. Tr. Ctfs. 30,.0 Bonds 15..0 Washington Natural Gas Co. 25..0 Debs. *American Esna Corp. bos tori Edison. 1st Mtg. 60..0 Debs. 75. 0 General Foods Corp. 50..0 Notes General Foods Corp. . 20.0 Louisville Gas & Elec. Co. 1st Mtg. 1 100. 0 Commonwealth Edison Co. Pref. Stk. 50.0 Carolina Power & Light Co. Bonds Baltimore Gas & Elec. Co. Bonds 40--45.0 20. 0 , Washington Gas Light Co. 1st Mtg. Southern Bell Tel. Telegrapl i Debs 150; 0 Co. 50. 0 1st Mtg. Texas Eastern Trans. Corp. 30. 0 Conv. Debs ^Continental Inv. Corp. S.F. Debs 35. 0 *Borg - Warner Corp. Certf.25. 0 *Union Tank Car Equip. Tr. i 60. o • *Add r e s s ograp h -Mu 11 igrap h Coif.Debs. 25. 0 Debs. Ramada. Inns Conv. debs. 50. 0 Avco Corp. S.F., debs. , 40. 0 ITT Debs. 75. 0 ^Beneficial Corp. 60. 0 , 1st Mtg. Florida Power.& Light Co. 78. 5 Bonds American Airline June June June June June June June June June June June June June June June 9 9 10 10 10 10 11 11 15 16 16 16 16 16 16 June J une June June June June June June June June June June 17 17 17 22 22 22 22 23 24 24 25 29 June June June June June June June June June June June June 30 ' 12 A TABLE 7: Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U.S. Treasury)1 As of June 5, 1970 (continued) ISSUER TYPE AMOUNT (MILLIONS OF DOLLARS) APPROXIMATE DATE OF OFFERING Corporates (Cont'd) Monogram Industries Gamble-Skogmo, Inc. *Detroit Edison Notes Cap. Notes Gen. & ref. Mtg. *Detroit Edison Com. Stk. Consolidated Natural Gas Go. Debs. Brooklyn Union Gas Co. 1st Mtg. Pacific Power & Light 1st Mtg. Kansas-Nebraska Natural Gas Debs. Co. Western Electric Co. Debs. 25.,0 20..0 75.,0 June June July 58.,0 40.,0 30.,0 25.,0 15. 0 July 1 July 7 July 9 July 14 July 22 150. 0 Sept.29 TABLE 7: Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U.S. Treasury)1 ISSUER TYPE AMOUNT (MILLIONS OF DOLLARS) . • I ! APPROXIMATE DATE OF OFFERING State and Local Illinois Bldg. Auth. Alabama, State of Winchester, Mass. *Atlanta Airport Delaware State Highway Dept. *New York State Transit Jefferson Parish, La. *Minn. -St. Paul, Minn. Metro Areai Utica Comm. Sch. Dist. Mich. Houston, Texas Indp. Sch. Dist. *0nondaga Co. N. J. California, State of Alaska, State of Richmond, Virginia Delaware River Port Auth. N.J. Prince Georges County, Md. *Austin, ISD, Texas Mass. Bay Transp. Auth. System, Mississippi Highway. Genesee Co., Mich. Los Angeles Calif. Parking Auth. Maryland, State of Tulsa, Oklahoma Detroit, Mich. San Francisco BARTS *0akland Co., Mich. Rev. . 41.7 15.0 G.O. 12.0 G.O. Rev. 41.0 Rev. 17.0 Transp. bonds 60.0 15.7 G.O. 42.0 G.O. . 15.5 G.O. . 10.0 G.O. 16.0 G.O. 1 0 0 . 0 , Bonds 12.9 G.O. 27.0 G.O. 75.0 Rev. 35.0 G.O. G.O. 14.8 65.0 Rev. 20.0 Bonds 11.2 Rev. 25.0 Rev. 46.8 G.O. 23.5 G.O. / ' 46.0 Rev. 50.0 Rev. 15.0 G.O. June June June June June June June June June June June June June June June June June June June June t&une July July July July July 8 9 9 10 jlO 10 11 15 15 16 16 16 17 17 17 18 24 24 30 1 1 7 13 14 Other 550.0 * June 10 Bonds 100.0 Bonds June 16 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. • Federal Home Loan Banks T.V.A. * 1 2 Postponements: 6/2 Penn Co - 100.0 - postponed indefinitely without explanation. TABLE 8: Stock Prices and Volume STOCK PRICES1 500° D.J. - IND. 1968 - High - Low 108.37(11/29) 985.21(12/3) 87.72(3/5) 825.13(3/21) 1969 • High Low 106.16(5/14 89.20(7/17) 1970 High Low NYSE AMEX 33.24(12/201) 82.1(6/7) 21.97(3/25) 34.0(2/23) AMEX 45.4(6/7) 14.1(2/23) 82.6(10/17) 32.8(4/4) 38.4(5/9) 12.9(4.4) 93.46(1/5) 69.29(5/26) 811.31(1/5) 631.16(5/26) 27.02(1/8) 19.36(5/27) 80.7(5/26) 44.6(3/20) 28.4(1/2) 12.1(4/24) 15 22 29 81.44 79.44 76.90 72.25 76.55 733.63 717.73 702.22 662.17 700.44 21.99 21.69 21.11 20.06 20.71 56.8 52.9 56.7 59.7 80.7 20.3 17.0 16.1 27.3 5 76.17 695.03 20.99 71.9 27.4 1 Figures other than highs and lows are Fridays only, for the year and are hot necessarily for Fridays. 2 1941-43 = 10. 3 Average dollar value of shares listed. .4 TRADING VOLUME 2 F 968.85(5/14)_32.91(1/3) 769.93(12/17) 25.02(7/29) 1970 - May. June • NYSE is the New York Stock Exchange; AMEX is the Total number of shares traded per week (millions normally conducted for 5-1/2 hours per day and 5 per week. In recent years, however, abbreviated over the time periods, shown below: From: Through: August 8, 1967 January 22,1968 June 30, 1968 January 3, 1969 July 7, 1969 January 2, 1970 August 20, 1967 March 1, 1968 December 31, 1968 July 3, 1969 December 31, 1969 May 1, 1970 • 18.6 Highs' and lows are American Stock Exchange. of shares). Trading is days per week, or 27-1/2 hours trading to the extent, and Hours/ Day 4 4 5-1/2 4 4-1/2 5 Days/ Week 5 5 4 5 5 5 Hours/ Week 20 20 22 20 22-1/2 25 % 15 STOCK PRICES AND TRADING VOLUME AM EX D.J. (Ind.) Weekly S&P (500) 1280 128 STOCK PRICES A M E X PRICE LEVEL INDEX S&P's 500 1200 120 1120 112 1040 104 960 96 880 88 800 80 720 Millions of shares 60 AMEX TRADING VOLUME (TOTAL FOR WEEK) 40 ; |;| ...I ,;ll| .I!,!, 20 'itStP NYSE TRADING VOLUME (TOTAL FOR WEEK) 1966 1967 72 TABLE 9: Security Credit END OF PERIOD CREDIT EXTENDED TO MARGIN CUSTOMERS BY: BROKERS 1 | BANKS 2 | TOTAL CUSTOMERS 1 NET DEBIT BALANCES NET CREDIT CUSTOMERS 1 NET EXTENDED BY BROKERS AND FREE CREDIT DEALERS 3 BALANCES 4,967 5,390 5,129 4,732 4,442 4,460 4,490 4,498 4,642 1969 - Apr. May June July Aug. Sept. Oct. Nov. Dec. 5,570 5,670 5,340 5,170 5,000 4,940 5,040 5,070 4,970 2,760 2,770 2,740 2,700 2,670 2,620 2,570 2,520 2,580 8,330 8,440 8,080 7,870 7,670 7,560 7,610 7,590 7,550 8,044 8,474 8,214 7,515 7,019 7,039 7,243 7,111 7,445 3,077 3,084 3,085 2,783 2,577 2,579 2,753 2,613 2,803 1970 - Jan. Feb.r/ Mar .x/ Apr. 2/ Change in Outstanding; 4,680 4,570 4,520 4,380 2,430 2,370 2,370 2,330 7,110 6,940 6,890 6,710 6,683 6,562 6,353 5,970 2,626 2,463 2,441 2,246 -20 100 -330 -170 -170 -60 100 30 -100 -20 10 -30 -40 -30 -50 -50 -50 60 -40 110 -360 -210 -200 -110 50 -20 -40 -274 430 -260 -699 -496 20 204 -132 334 -271 7 1 -302 -206 2 174 -140 190 -57 423 -261 -397 -290 18 30 8 144 -290 -110 -50 -140 -150 -40 -440 -170 -50 -180 -762 -121 -209 -383 -177 -163 -22 -195 -585 42 -187 -188 1969 - Apr. May June July Aug. Sept. Oct. Nov. Dec. 1970 - Jan. Feb.r/ Mar. r/ Apr. 2/ 1 . 2 3 —— -40 ; ^ 4,057 4,099 3,912 . 3,724 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 apd 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. TABLE 10: Savings Flows at Nonbank Depositary Intermediaries ($ millions) , DATE 5,082 4,208 2,551 1967 1968 1969 1969 - Feb. Mar. Apr. 1970 - Feb. Mar. Apr. 1969 - Nov. . Dec. MUTUAL SAVINGS BANKS REGULAR DEPOSITS 3 NET ANNUAL NEW GROWTH NET . MONEY2 FLOW RATE 1 '.a, 4.0 331 642 -197 £/ / 246 510 -6 . 272 229 - 4,9 4.1 2,376 1,143 -747 SAVINGS & LOAN ASSOCIATIONS SHARE CAPITAL NET N EW . ' ANNUAL NET MONEY2 GROWTH 1 FLOW RATE TOTAL ' DEPOSITS 1 | NET • • NEW ANNUAL NET GROWTH MONEY ? RATE 1 FLOW Not Seasonally Adjusted 10,649 9.4 6,129 7,399 6.0 2,738 4,020 3.1 -1,003 I 15,731 11,607 6,371 264 81 -325 605 1,370 -516 150 -88 -136 205 1;655 234 /-- • 9.4 6.3 3.4 / 8,505 3,882 -1,749 569 479 -543 936 2,012 -713 833 560 868\ 177 ' 554 253 451 2,165 228 327 466 117 - Seasonally Adjusted 265 2.4 47 0.4 \ 537 276 3.2 1.3 1970 - Jan. -117 -2.1 -754 -6.7^ -871 -5.2 Feb. 298 ; 5.4 247 2.2 545 3.3 'Mar. — 1,021 —Apr. P./ - 6:4 1,000 1 Annual growth rate for monthly data, is the annualized monthly percentage increase in deposits. ..2 Net New Money is new deposits net of both withdrawals and interest. Data for S&Ls are for insured associations only, which represent 967= of industry total*resources. 3 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. '.SOURCES: National Association of Mutual Savings Banks and Federal Home Loan Bank Board. Its l:b i;lli 1:1 — ^ , SAVINGS FLOWS (seasonally adjusted) Monthly f dollars • 2000 1600 TOTAL 1200 800 400 + 0 400 1200 SAVINGS & LOANS 800 400 + 0 400 800 MUTUAL SAVINGS BANKS 400 + 0 400 TA^LE 11:. Mortgage Commitments at Selected Thrift Institutions DATE , TOTAL 1969 - Mar. » Apr. "May June July Aug. Sept. Oct. Nov. Dec. 10.3 10.5 10*4 10.2 9.9 9.5 » 9.2 8.9 8.6 8.4 1970 - Jan. Feb. Mar. 8.2 7.9 7.9 1 NET CHANGE > -, OUTSTANDING COMMITMENTS | ; ALL . . MUTUAL .ALL \ MUTUAL | XSAVINGS TOTAL SAVINGS & SAVINGS' ' • SATFLMGS & ' 1 LOAN BANKS *• BANKS LOAN (N.Y. STATE.) ' (N.Y. STATE) ASSOCIATIONS ASSOCIATIONS (Billions of Dollars, Sea.sonally Adjusted) 1/ 7.0 7.2 7.1 7.0 6.8 6.5 6.4 6.1 5.9 5.8 1 5.6 5.4 5.2 . 3.3 3.3 3.2 3.2 3.1 3.0 2.8 2.7 2.7 2.6 2.6 2.5 2.5 „ .18 .15 -.11 -.18 -.32 -.36 -.31 -.33 -.24 -.25 .12 .14 f -.06/ -ill/ -.22 -.24 -.18 . -.23 -.18 -.12 -.17 -.31 -. 22 -.23 -.17 ' ; .06 ;o2 . -,,05 -.06 -.10 -.12 -.13 - -.09 -^06, -.13 ' ' : ! 1 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 non- , residential 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. .04 -.07 -.02 " MORTGAGE COMMITMENTS OUTSTANDING (seasonally adjusted) "Billions of dollars Monthly TOTAL S&L'S * N.Y.-MSB'S Includes build,ng loans beginning August 1967 1960 1962 1964 1966 1968 1970 TABLE 12: Net Change in Mortgage Holdings DATE' TOTAL "INCLUDING FNMA-GNMA 1 FINANCIAL INSTITUTIONS LIFE SAVINGS &| .LOAN 1 INSURANCE ASSOC. | COMPANIES MUTUAL . j TOTAL |xCOMMERCIAL - ,SAVINGS BANKS - BANKS u : r:XA-c::HA Not Seasonally Adjusted 1966 1967 1968. 1969 1969 Feb. Mart 1970 - Jan 1 Feb. Mar. 18,197 19,988 23,827 23,485 15,874 18,191 21,319 19,110 4,705 . 4,639 6,677 5,152 1,701 1,750 1,964 1,500 . 1,529 1,759 451 480 519 1,091 .• ' 487 #16' 1,149 • n.a,. n. a. . • 2,760 3,118 2,796 \2,495 293 • - 228 198 38 ' 106 153, 100 100 0 4,648 2,914 2,496 2,056 3,761 7,520 9,350 '9,407 622 671 ' 917 136 223 . ' 134 150 125 : • 1 . 213 187 ' n.a;. . 317 2,323 1 1,797 i 2,508 » 4,375 201 221 • 2 0 5 604 533 529 Seasonally Adjusted ^ 1969 - Feb. : MKr. Apr. t May ' June' « July Aug. Sept. Oct. Nov. • Dec. 2,025 2,202 1,906 2,099 1,91b/ 2,1-17 1,808 2,032 1,875 2,153' 1,364 1,698 1,380 1,910 . .1,365 1,876 1,166 1,734 1,069 1,652 1,906 1,292 1970,- - Jan. Feb. • Mar. 1,493 1,604 937 1,105 • n.a. 668 632 567 534 440 151 310 383 244 237 .347 288 • 285 114 - 884 266 875 230 899 240 251 854 1,022 230 859 181 : 720 157 654 137 627 124 i.46 . 547 576 235 24 143 .197 • 400 436. . 276 „ 207 159 194 169 183 173 193 191 171 139 134 - 225 241 177 193 207 224 ' 278 ' 334 530 511 568 583 614 556 499 .516 Monthly data for commercial banks based on Federal Reserve estimates benchmarked to* Call" Report data on rfeal estate loans outstanding as-1 available. Other data derived from mortgage debt outstanding as reported separately by Rational 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 for 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 1967. 23 NET CHANGE IN MORTGAGE HOLDINGS (seasonally adjusted) Billions of dollars T i n Monthly n 3.0 2.5 TOTAL, INCt.. FNMA - GNMA 2.0 1.5 FINANCIAL INSTITUTIONS 1.0 1967 1968 1969 1970 TABLE 13: Net Increases in Mortgage Debt Outstanding Billions of dollars, SAAR ^ . QUARTER TOTAL MULTI-AND COMMERCIAL FARM" 15.2 14.8 12.1 8.4 7.0 4.4 3.6 2.6 2.1 6; 9 6.5 5.5 4.2 11.6 10.1 8.2 6.2 2.4 2.2 2.2 1.8 15.6 20.5 27.0 27.5 10.0 13.8 19.6 19.9 6.8 10.5 15.7 16.0 3.2 3.4 3.9 3.9 3.8 4.9 4.9 4.9 7.2 8.2 8.7 8.8 1.8 1.8 2.5 2.7 ip/ 27. 1 IIP 25.9 IIIl > 26.5 .IVp 30.1 18.4 18.0 18.2 20.5 15.4 14.8 14.6 16.5 3.0 3; 2 3.5 4.0 6.3 5.7 6.5 7.8 9.4 8.9 10.1 11.7 2.3 2.2 1.8 1.8 22.1 21.2 19.8 16.9 17.,9 16.5 15.1 . 13.0 4.2 4.7 4.6 3.9 6.1 5.0 4. 6 5.1 10.3 9.6 9.1 9.0 2.2 2.3 2.0 1.9 - I£/ II III IV j 28.5 24.3 18.7 1967 . - ip/ i 1 IIP IIIl > IVp 1969 1- to 4-| MULTIFAMILY j FAMILY. COMMERCIAL 19.2 15.6 11.0 9.2 1966 1968 RESIDENTIAL 3 - i£/ iip 30.4 28.5 n i l > 26.4 IVp 24.0 Derived from data on mortgage debt outstanding from Federal Deposit Insurance Corporation, Federal Home Loan Bank Board, Institute of Life Insurance, National Association of Mutual Savings Banks, Departments of Commerce and Agriculture, Federal National Mortgage Association, Federal Housing . Administration, Veterans Administration and Comptroller of the Currency. Separation of non-farm mortgage debt by type of property, where not available* and interpolations and extrapolations, where required, estimated by Federal Home Loan Bank Board and the Federal Reserve. Residential mortgage debt includes nonfarm only and is sum of 1-to 4-family and multifamily mortgage debt combined. NET INCREASES IN MORTGAGE DEBT OUTSTANDING Quarterly Billions of'dollars, seasonally adjusted annual rate 32 TOTAL 24 TOTAL RESIDENTIAL 1-4 FAMILY COMMERCIAL MULTIFAMILY 1966 1970 TABLE 14: FNMA Weekly " A u c t i o n " Results 1 WEEK ENDED COMMITMENTS IN $ MILLIONS ' IMPLICIT, YIELD 2 (per cent) ACCEPTED 1 -YEARll 1-YEAR 1 90TOTAL TOTAL 9066& OVER OFFERED M0NTH & OVER DAY DAY M0NTH 1970 - Mar. 9 23 354.6 395.4 276.4 239.0 60.7 47.5 136.5 124.5 79.2 67.0 9.16 9.12 9.19 ' 9.14 Apr. 6 20 268.4 315.7 190.2 185.2 41.0 54.0 121.4 98.2 27.8 33.1 9.05 9.02 9.07 9.04 . 9.10 9.10 May 5 11 18 25 443.3 269.2 300.3 289.5 195.5 102.2 136.3 145.2 43.5 26.0 32.4 38.9 121.1 63.2 86.4 86.7 38.9 13.0 17.5 19.7 9.01 9.04 9.11 9.15 9.04 9.07 9.13 9.18 9.10 9.13 9.18 9.22 1 8 224.2 113.8 .' 31.1 (300.Ofi 71.4 11.3 9.20 9.24 9.27 June 9.13 " 9.12 Note: Under the FNMA auction system, approved sellers of'Governmentunderwritten mortgages bid for FNMA•forward purchase commitments, subject to an over-all dollar limit announced by FNMA in advance. Bids accepted by FNMA are for delivery at the seller's option, and at any ' time within the specified period.. Bids on proposed homes relate t:o construction not yet started on which mortgages may be delivered only after completion and occupancy. 1 For "proposed construction" of new homes only. 2 Average secondary market yield 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 50 basis points fee paid by investors to servicers. 3 FNMA announced limit of accepted bids for next week's auction. 27 FNMA "AUCTION" RESULTS $ Millions 200 AMOUNT OF ACCEPTED BIDS BY COMMITMENT PERIOD 150 6 MONTHS 100 1 YEAH AND OVER 3 MONTHS IMPLICIT YIELD 6 - M O N T H COMMITMENTS • -• — : i r i i 1 I I l l i i i i i TOTAL BIDS RECEIVED | | JUNE [TOTAL BIDS ACCEPTED! AUG. OCT. 1969 DEC. 4-•' FEB. APR. JUNE 1970 AUG. OCT. , DEC. TABLE 15: Private Housing Starts and Permits STARTS SEASONALLY ADJUSTED ANNUAL RATE TOTAL 1-FAMILY 2 OR MORE DATE 9 - Apr. May June July Aug. Sept. Oct. Nov. Dec. 0 - Jan. Feb. Mar. Apr. - 1,505 1,533 1,507 1,429 1,376 1,481 1,390 1,280 1,402 797 877 826 803 752 828 766 762 776 708 656 681 626 624 653 624 518 626 1,059 1,306 1,384 1,181 577 725 702 693 482 581 682 488 1 TOTAL • UNADJUSTED TYP E OF FINANCING FHA VA OTHER BUILDING PERMITS (SEASONALLY ADJUSTED ANNUAL RATE) 2 159.0 155.5 147.3 125.2 124.9 129.3 123.4 94.6 84.1 23.0 21.1 21.5 20.8 22.4 18.3 25.1 18.8 23.2 131.6 4.4 130.1 4.3 121.2 4.6 4.7 . 99.7 4.2 98.3 106.2 4.8 93.3 5.0 3.9 74.7 4.2 57.9 1,502 1,323 1,340 1,228 1,245 1,201 1,183 1,191 1,239 66.4 74.3 113.9 123.8 16.5 17.5 25.2 32.4 3.4 3.9 4.8 5.4 46.5 52.9 83.9 86.0 1,013 1,137 1,099 1,249 Total starts are Census estimates including farm for both permit-issuing and nou-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. 2 Building permits before January 1963 are Census estimates for about 10,000 areas identified as having a local building permit system in 1959. Estimates beginning January 1963 are for approximately .12,000 and beginning January 1967 13,000, or all known permit-issuing places. . Unlike starts, seasonally adjusted building permits reflect direct adjustment for differences in the number of working days per month, as well as other differences in timing and coverage. PRIVATE HOUSING STARTS AND PERMITS Monthly, annual rates Millions of units SEASONALLY ADJUSTED 2.0 HOUSING STARTS 1.6 1.2 BUILDING PERMITS (in issuing areas) PER CENT OF UNADJUSTED TOTAL STARTS MULTI-FAMILY 40 GOVERNMENT UNDERWRITTEN 1964 1966 1968 1970 TABLE 16: Mortgage and Bond Yields FHA MORTGAGES 2 - - DATE 25 -YEAR 30-YEAR 1959-60 - High 19*61-66 - Low 1966 - High 1967 - High Low 1968 - High Low 1969 - High Low 6 .26 5,.43 6..73 .a.- . a. , a. , a. . a. n. a. 1969 - Dec. n. a. CONVENTIONAL MORTGAGES 3 1 . NEW SPREAD BETWEEN YIELDS Aaa CORON CONV. & . PORATE BONDS FHA M0RT. GAGES SPREAD BETWEEN YIELDS ON NEW "CORPORATE BONDS AND FHA MORTGAGES n. a. 5.44 .6.81 6.81 6.29 7.52 6.78 8.62 7.99 6.30 5.80 6.70 6.70 6.40 7.40 =6.75 8.35 7.55 .23 .25 .30 .11 -.12 .12 -.27 .40 .13 5.25 4.41 5.82 1.69 .77 1.16 6.51 5.18 6.79 6.15 8.75 6.91 1.28 .27 1.20 .26 1.08 -.13 8.62 8,35 -.27 8.75 -.13 8.46 8.55 . n. a. 1970 - Jan. .99 8.30 9.29 8.55 -. 74 Feb. n. a. .60 8.60 -.65 8.55 9.20 n. a. Mar. ' .50 8.60 -.55 9.10 8.55 a. n. „ Apr. 1 Neither mortgage nor bond yields include 1 allowance for servicing costs which arc much higher for mortgages than for bond's. 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-fieId-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. Over the period for which they can be compared, the movement of the two mortgage yield series has been similar. Dashed lines indicate periods of adjustment .to changes in contractual interest rates. ' „ 3 Based on FHA-field-office opinion on typical interest rates (rounded) on conventional first mortgages prevailing in the market areas of insuring officecities. Beginning with April 1960, rate relates only to new-home mortgages; prior to that date, rate related to both new as well as existing-home mortgages.. Dashed line indicates this change in the series. 4 See note for Table 1. MORTGAGE AND BOND YIELDS Monthly Per cent HOME MORTGAGES: CONVENTIONAL FHA Aaa CORPORATE BONDS: ^ NEW ISSUES _ Y I E L D S P R E A D ( F H A MORTGAGE VS. NEW ISSUE Aaa CORPORATE BONDS) Basis Points 200 100 100 1962 1964 1966 1968 1970 TABLE 17:. Conventional Mortgage Terms NEW HOMES CON- FEES & TRACT CHARGES EFFEC- MATURITY (YEARS) (PER TIVE RATE CENT) RATE (PER CENT) . 2 3 1969 Apr. May . June July Aug. Sept. Oct. Nov. Dec. 0.96 0.88 7.62 7.65 7.76 7.91 7.47 7.50 7.62 7.76 7.86 7.89 7.99 7.97 8.07 0.86 8.00 0.92 0.89 0.96 1.06 8.05 ' 8.13 8.13 8.25 8.16 Jan. 8.23 Feb. Mar. r/ 8.29 8.23 Apr. 1.08 1.09 1.11 1.02 8.34 8.41 8.47 8.40 0.84 0.92 25.4 25.8 25.6 25.5 25.2 25.3 25.3 25.3 25.45 EXISTING HOMES. LOAN/ CON- FEES & LOAN/ TRACT CHARGES EFFEC- MATU- PRICE PRICE LOAN (PER RITY RATIO RATIO ' AMT. RATE TIVE CENT) RATE (YEARS) (PER (PER ($000) (PER CENT) CENT) CENT) 2 3 4 7.46 0.85 0.83 7.54 7.64 . 0.86 0.91 7.79 0.93 7.90 7.98 0.91 8.00 0.90 72.6 73.2 73.0 72.0 72.3 72.9 72.8 72.8 71.9 24.8 25.0 24.9 24.5 24.3 25.0 24.6 24.6 25.0 8.08 69.3 71.8 71.1 71.1 25.1 24.9 25.1 24.5 8.13 8.23 8.26 8.20 8.00 0.93 7.60 7.68 7.79 7.94 8.05 8.13 8.15 8.15 8.24 0.94 1.02 0*98 0.90 8.29 8.41 8.43 8.35 0.90 23.0 22.7 22.8 22.8 22.6 22.2 LOAN AMT. ($000) 22.6 22.9 71.8 71.9 71.4 71.7 71.2 70.7 70.4 70.4 70.6 20.1 20.8 22.4 22.4 22.6 22.8 70.3 70.2 70.4r 70.4 20.5 20.4 20.6 20.4- 22.6 19.9 19.7 20.1 20.1 19.8 19.2 19.5 1970 25.0 25.2 25.0 " 24.8 1 Compiled by Federal Home Loan Bank Board in cooperation with Federal Deposit Insurance Corporation. Data are weighted averages based on probability sample survey of charac- , teristies of conventional first mortgages originated by major institutional lender groups"(including mortgage companies) for purchase of single family homes. Data ex- . elude loans for refinancing, reconditioning or modernization; construction loans to home^builders; and permanent loans which are coupled with construction loans to ownerbuilders. Related series oh 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. 2 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. 3 Includes fees & charges amortized over a 10 year period in addition to the contract interest rate. . , ^ 4 • Derived by FRB. CONVENTIONAL MORTGAGE TERMS Monthly MATURITY NEW 25 EXISTING 20 15 80 LOAN/PRICE RATIO NEW t A / X / ~ ~ X ^ v / -• 75 n EXISTING \ k 70 1 1 i. i 1 i i i M i i I I i i 1 i i II,i i i i 65 i i i Thousands of doll LOAN AMOUNT 30 EXISTING 10 J 1964 1966 I. 1968 ii i i i i i i i i i i i i i i i ii 1970 * CHANGE IN SERIES