Full text of H.16 Capital Market Developments : May 11, 1970
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DECONTROLLED' AFTER SIX MONTHS L.5.8 Confidential (F.R.) CONFIDENTIAL L " May 11, 1970 a V CAPITAL MARKET DEVELOPMENTS Capital Markets Section, Division of Research and Statistics, Board of Governors of the Federal Reserve System, Washington, D. C. INDEX Developments in the Corporate and Municipal Bond Markets 3-5 6-7 Capital Market Yields 8-13 Capital Market Volume 14-17 Stock Market 18-33 Mortgage Market SYMBOLS: e Estimate „ P Preliminary r n.a. Revised Not available TABLE 1: Yields, Volume and Reception YIELDS MOODY'S SEASONED NEW ISSUE 1 Aaa WEEK ENDING: 1970 - Apr. May 3 10 17 24 8;55 8.30 8; 65 8.75 7; 85 7;80 7.82 7.83 725 551 373 317 95 68 87 99 1 8 15 8.91 6.98 n. a. 7.92 7.99 n. a. 195 350e 500e 99 100 n.a. YIELDS BOND BUYER MOODY'S SEASONED 20 SEASONED Aaa BOND INDEX / WEEK ENDING: 1970 - Apr. May CORPORATE BOND MARKET VOLUME 2 PER CENT GROSS SOLD BY END BONDS SCHEDULED OF WEEK OFFERINGS WITHIN 28 DAYS 3 10 17 24 5;90 6; 10 6.25 6.47 6.11 6.33 6.50 6.73 1 8 15 6.50 6.55 6.79 6.89 n.a. 685 444 448 733 2,717 2,636* n.a. MUNICIPAL BOND MARKET VOLUME2 PER CENT GROSS SOLD BY END OF WEEK OFFERINGS . 264 429 473 398 63 88 78 73 196 98 300e 77 68 , ^ BONDS SCHEDULED WITHIN 28 DAYS' 1149 931 1047 649 530 624 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.) i 2 Millions of dollars unless otherwise indicated. ' I Note: Sec footnotes to Table 3 * AT&T rights offerings included in May estimate. } > , • ; TABLE 2: Details on Inventories DATE OFFERED , CORPORATE BQNDS IN SYNDICATE END OF LATEST WEEK ORIGINAL RATING AND ' 'v • V YIELD CALL PROTECTION COUPON ISSUER \ AMOUNT (MIL. $) ESTIMATED PROPORTION SOLD None 5/4 5/5 5/5 5/5 4/29 4/28 4/7 4/9 CORPORATE BONDS RELEASED FROM SYNDICATE DURING LATEST WEEK ORIGINAL INCREASE COUPON • ISSUER IN YIELD YIELD AMOUNT. 20:0 15.0 40.0 50.0 May Potomac Edison Penn Pwr. Essex International Jones & Laughlin INVENTORIES 1 . MUNICIPALS.. BLUE LIST | IN SYNDICATE .DATE 1970 - Apr. . 10 17 24 —- 1 8£/ 9.25 9.20 9.25 9.88 9.25 9.10 9.25 10.01 . +31 +21 +107 +61 ESTIMATED PROPORTION RELEASED a DATE | RELEXSED Ii OFFERED A 5 Aa 5 Baa 5 Baa 10 yrs yrs yrs yrs 4Q% 15% 10% 10% CORPORATES IN SYNDICATE 553 550 557 113 154 154 210 123 36 541 484 116 90 24 0 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 MUNICIPAL BONDS IN SYNDICATE 300 200 100 SEPT. DEC. 68 MAR. JUN. 1969 SEPT. DEC. MAR. JUN. 1970 SEPT. DEC. / ' NEW CORPORATE Aaa 1 DATE U.S. GOVERNMENT 20-YEAR CONSTANT MATURITIES 3 BOND BUYER'S SEASONED MUNICIPALS 4 5.90(1/20) 5.18(8/9) 4.85(1/26) 4.07(8/8) 8.85(12/5) 6.90(2/21) 7.84(12/26) 6.55(1/3) 6.97(12/26) 5.96(1/24) 6.90(12/18) 4.82(1/28) 8.98(5/8) 8.20(2/27) 7.99(5/8) 7.79(3/6) 7.15(5/8) 6.60(3/6) 6.89(5/8) 5.95(3/12) 17 24 8.65 8.75 7.82 7.83 6.79 7.01 6.50 6.73 1 8 8.91 8.98 7.92 7.99 7.08 7.15 6.79 6.89 7.02(12/13) 6.13(8/30) 1969 - High Low 1970 - High Low May MOODY'S SEASONED CORPORATE Aaa * 6.55(1/27) 5.95(9/13) 1968 - High Low 1970 - Apr. . TABLE 3: High Grade Bond Yields 1 \ \^ New corporate issues, with call protection, adjusted (as described in footnote 1 of Table 1) to a Aaa basis. Weekly average of daily figures. Average term of bonds included is 2 22-24 years. 3 Weekly average of daily figures. 4 Thursday figures. The average rating of the 20 bonds used in this index i falls midway between the four top groups as classified by Moody's In-° vestors Service. Note—Highs and lows are for individual series and may be on different dates for different series. HIGH GRADE BOND YIELDS Per cent NEW CORPORATE MOODY'S V / 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 STATE AND LOCAL 2 1 19 7 0 1969 196 8 January February • March 2,601 l,810e 3,400e 2,075 2,045 2,098 1,771 1,608 1,799 April May June 3,000e 4,lOOe 2,748 2,076 2,530 1,428 1,866 2,411 • July August September 2,478 1,427 2,427 2,143 1,432 1,557 October November December 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 1st 2nd 3rd 4th Quarter Quarter Quarter Quarter 1st half Three quarters Year 7,811e r i I 196 8 19 70 1969 1,338 1,212 1,499 1,262 987 538 1,178 1,158 1,404 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 l,650e l,000e j 4,049 Excluding finance companies 3 1st 2nd 3rd 4th Quarter Quarter Quarter Quarter Year 6,170 '5,107 5,427 4,785 5,654 ! I 20,973 1 . Securities and Exchange Commission estimates of gross proceeds. 2 Investment Bankers Association of America estimates of principal amounts. 3 Total gross proceeds excluding offerings of sales and consumer finance companies. Note; 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 PUBLICLY OFFERED GROSS PROCEEDS BY TYPE OF ISSUE COMMON AND ISSUES INCLUDED PRIVATELY PFD. MFG. PLACED FOREIGN CONVERTIBLE STOCK 1969 - I II III IV 1970 - I e/ 6,218 7,354 6,332 6,840 7,811 2,657 3,411 3,186 3,479 4,554 1,540 1,673 1,347 1,053 1,185 1969 - Apr. May June July Aug. Sept. Oct. Nov. Dec. 1970 - Jan. Feb. Mar. Apr. 2,748 2,076 2,530 2,478 1.426 2.427 1,933 2,375 2,532 •2,601 1,268 871 1,272 1,279 685 1,222 969 1,164 1,346 1,594 649 510 514 609 259 479 313 226 514 485 300 400 400 1 1,810 1,060 3,400 3,000 1,900 2,000 2,023 2,268 1,797 2,307 2,072 830 694 744 589 482 726 651 984 672 522 450 1,100 600 GROSS PROCEEDS BY TYPE OF ISSUER PUBLIC UTILITY ISSUERS 1 215 227 289 115 1,355 1,126 750 809 862 1,,407 1,,773 i;,862 i,,314 2,,787 1 ,346 = 1 ,878 = 1=,544 1,967 1 ,939 473 432 684 598 709 2,993 3,266 2,243 2,961 2,377 62 430 463 233 214 167 369 105 303 401 387 225 250 330 513 569 691 875 362 625 260 453 601 787 500 1 ,500 800 784 392 702 493 507 544 745 622 600 639 44 197 191 286 126 272 120 201 277 229 1,405 915 946 826 433 984 808 1,099 1,054 947 480 820 960 220 260 25 610 820 1,215 28 137 132 122 35 59 8 48 60 n.a. n.a. n.a. Other issuers are extractive, railroad and other transportation, real estate and finance, and commercial and other. Source: Securities and Exchange Commission. Quarterly supplements are available. COMMUNICATIONS T A B L E b: ISSUER Large Long-term Public Security Issues for Nev, Capital (Other than U.S. Treasury) 1 v TYPE ' AMOUNT (MILLIONS OF DOLLARS) I ! : i.ulTON oriT.R- ' :'<)o HA, . .OR MATURITY ' ! • i. i 1 . 11. , K - INC : i 1 COST i Y1HLU ..L Corporate Philadelphia Elec. Co. Boise Cascade Credit Corp. Carolina Pwr & Light Hartford Elec Light Co. Aluminum Co. of America Southern Union Gas Co. Jewel Cos. General Acceptance Corp. 1st Mtg. Debs Pref,, stk. 1st m t g . / S.F. debs. S.F. debs. Com istk. Debs 40. 0 75.,0 30.,0 20.,0 150..0 15..0 24..7 50..0 1976 1975 8. 50 10.,00 8. 50 10.,00 2000 1995 1990 9. 25 9.,00 9.,75 9,,20 9,.10 9,,75 1990 10,,25 10,.25 Aaa Bbb Aa A A Bbb TABLE 6: Large Long-term Public Security Issues for New Capital (continued) (Other than U.S. Treasury).' ISSUER I TYPE 2 AMOUNT (MILLIONS OF DOLLARS) MATURITY COUPON RATE OR NET INTEREST COST OFFERING YIELD MOODY'S RATING State & local Government Kansas City, Kansas Louisiana Stadium and Exposition District Fulton Co. Ga. Sch. Dist, Oakland Co, Mich. Rev. Rev. G.O. Bond 22.0 1971-90 6.71 16.5 1971-91 1971-95 1971-99 6.00 Not reoffered 6.71 4.60-7.00 7.55-7.57 5.00-7.80 12.0 20.9 4.75-7.10 Rights offering. Includes corporate and other security offerings of $15 million and over; State and local security offerings of $10 million and over. In case of State and local government securities, G.O. denotes general obligation; Rev.-Ut., revenue obligations secured only by income from public utilities; Rev.-Q.-Ut., revenue bonds secured only by income from quasi-utilities; Rev.-S.T., revenue bonds secured by revenue from specific taxes only; Rev.-Rent., revenue bonds secured solely by lease payments. Includes foreign government and International Bank for Reconstruction and Development issues and non-quaranteed issues by Federal Agencies. N. A. n .R. A-l A-l TABLE 7: Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U.S. Treasury)1 (continued) ISSUER TYPE Corporate Chase Manhattan Mtg. Trust Debs. Chase Manhattan MtR. Trust Benf. Int. Canadian Pacific Railway Co Equip. Trust Debs. Raytiestos-Manhattan, Inc. Debs. National Cash Register Central Hudson Gas & Elec-to 1st mtg. First National Holding Corp .Debs. 1st Mtg. Monongahela Power Co. Bds. Burroughs Corp. Notes American Brands Columbus & Southern Ohio Co Bds. 1st Mtg. Southern Counties Gas Go. Debs. Bunker-Ramo Corp. Debs w/w AT&T Debs. Mapco Inc. 1st Mtg. Northern States Power Co. Florida Power and Light Co. 1st Mtg. Bds. New York Telephone Co. Bds. Ohio Edison Co. Dallas Power and Light Co. 1st Mtg. Bds. Cleveland Elec/111.Co. Texas Eastern Transmission 1st Mtg. 1st Mtg. Dayton Power & Light Co. Conv. debs. Avco Corp. General Tele, of California Debs. 1st Mtg. Western Mass. Elec. Co. Kansas City Power & Lgt. Co 1st Mtg. Com. stk. Consumer Power Co. Debs. New Jersey Bell Tel. Co. Bds. West Penn.Power Debs. Lone Star Gas Co. Bds. Appalachian Power Co. 1st Mtg. Consurtier Power Co. 1st Mtg. Boston-Edison Louisville Gas & Elec. Co. 1st Mtg. AMOUNT (MILLIONS OF DOLLARS) 60.0 60.0 30.0 25.0 150.0 " 25.0 25.0 15.0 75.0 100.0 30.0 32.0 20.0 1569.0 20.0 45.0 60.0 150.0 45.0 30.0 . 75.0 50.0 35.0 ' 50.0 70.0 30.0 35.0 40.0 100.0 25.0 30.0 70.0 60.0 j60.0 20.0 APPROXIMATE DATE 'OF OFFERING ! . May 11 May 11 . May 12 May 12 May 12 May 12 May 13 May 13 May 13 May 14 May 14 May 14 May 18 May 18 (rts. exp.) May 18 May 19 May 20 May 20 May 21 May 25 May 26 May 26 May 26 May June 2 June 3 June 4 June 5 June 8 June 9 June 10 June 15 June 17 June 22 June 23 TABLE 7: Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U.S..Treasury)1 ISSUER TYPE AMOUNT (MILLIONS OF DOLLARS) APPROXIMATE DATE OF OFFERING State and Local Government Utica Mich. Com. S/D Puerto Rico Wtr Res. Auth. Detroit, Mich. Mississippi Metro. Wtr. Dist. of So. Cal. Montana, State of Delaware, State of Miami Beach, Florida Los. Ang. Calif. Parking Auth. Monroe Co. Comm. Sch. Bldg. Corp., Indiana Connecticut, State of Austin, Texas ^Massachusetts, State of Richmond, Virginia Massachusetts Bay Transp. Auth. System Delaware River Port Auth, N.J. G.O. Bds. . Rev. G.O. Rev. Rev. G.O. Rev. Rev. 15.5 70.0 24.0. 20.9 100,0 17.4 20.0 12.0 25.0 May May May May May May May May May 11 11 .12 12 12 12 13 13 15 1st Mtg. Rev. G.O. Rev. & GeOe G.O. G.O. 10.5 75.0 11.3 47.4 27.0 May 19 May 19 May 21 May 21 June 17 Rev. Rev. 65.0 75.0 June 24 June 17 Other Federal Home Loan Bank * 1 Bonds 200.0 May 20 Included in table for first time. Includes corporate and other issues of $15 million and over; State and local 1 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. Postponements: Signal Companies 75.0 market conditions Appalachian Power Co. 70.0 market conditions Pennsylvania St. Pub. Sch. 21.4 , no bids received Bethlehem Steel Corp. 150.0 market conditions Long Beach California 30.0 market conditions 1 Public Service Co. of Colorado 22.8 market conditions Arkansas Power and Light Company 25.0 market conditions TABLE 8: Stock Prices and Volume STOCK PRICES 1 S&P 5003 DATE TRADING; VOLUME 2 AMEX 4 D.J. - IND. AMEX NYSE 1968 - High Low 108.37(11/29) 985.21(12/3) 33.25(12/20) 87.72(3/5) 825.13(3/21) 22.00(3/22) 82.1(6/7) 34.0(2/23) 45.4(6/7) 14.1(2/23) 1969 - High Low 106.16(5/14) 89.20(7/17) 968.85(5/14) 32.91(1/3) 769.93(12/17)25.02(7/29 82.6(10/17) 32.8(4/4) 38.4(5/9) 12.9(4/4) 1970 - High Low 93.46(1/5) 78.60(5/5) 811.31(1/5) 709.81(5/5) 27.02(1/8) 21.42(5/5) 60.1(2/6) 44.6(3/20) 28.4(1/2) 12.1(4/24) 1970 - Apr. 17 24 85.67 82.77 775.94 747.28 23.35 22.40 50,3 50.0 14.4 12.1 81.44 79.44 733.63 717.73 21.99 21.69 56.8 52.9 20.3 17.0 May 1 8 i Figures other than highs and lows are Fridays only. for the year and are not necessarily for Fridays. 2 1941-43 = 10. 3 Average dollar value of shares listed. 4 NYSE is the New York Stock Exchange; AMEX is the American Stock Exchange.Total number of shares traded per week (millions of shares). Trading is normally conducted for 5-1/2 hours per day and 5 days per week, or 27-1/2 hours per week. In recent years, however, abbreviated trading to the extent, and over the time periods, shown below: Hours/ Days/ Hours/ From: Through: Day Week Week August 8, 1967 January 22, 1968 June 30, 1968 January 3, 1969 July 7, 1969 ^ January 2, 1970 August 20, 1957 March 1, 1968 December 31, 1968 July 3, 1969 December 31, 1969 May 1, 1970 4 4 5-1/2 4 4-1/2 5 Highs and lows are 5 5 4 5 5 5 20 20 22 20 22-1/2 25 15 STOCK PRICES AND TRADING VOLUME AM EX 36 STOCK PRICES 32 - 28 - 24 Weekly i ' • I i I i i I I I I i I i AMEX PRICE LEVEL INDEX Z V l J SAP's 5 0 0 V D.J. SAP (Ind.) (500) 1 2 8 0 128 - 1200 120 - 1 1 2 0 112 - 1040 104 - 20 16 /V W 12 - v V 1 D J . IND. 1 M \ U y W 8 - 960 96 880 88 800 80 720 72 Millions of shares AMEX TRADING VOLUME (TOTAL FOR WEEK) NYSE TRADING VOLUME (TOTAL FOR WEEK) 1966 1967 1968 1969 1970 TABLE 9: Security Credit END OF PERIOD CREDIT EXTENDED TO MARGIN CUSTOMERS BY: BROKERS' | BANKS 2 | TOTAL 2 3 NET CREDIT CUSTOMERS' NET EXTENDED BY FREE CREDIT BROKERS AND DEALERS 3 BALANCES 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 4,967 5,390 5,129 4,732 4,442 4,460 4,490 4,498 4,642 1970 - Jan.x/ Feb.r/ Mar.]>/ 4,680 4,570 4,510 2,430 2,390 2,370 7,110 6,960 6,880 6,683 6,562 6,353 2,626 2,463 2,441 4,057 4,099 3,912 -190 -40 110 -360 -210 -200 -110 50 -20 -40 -830 -274 430 -260 -699 -496 20 204 -132 334 -351 -271 7 1 -302 -206 2 174 -140 190 -477 -57 423 -261 -397 -290 18 30 8 144 -440 -150 -80 -762 -121 -209 -177 -163 ^22 -585 42 -187 Change in Outstanding: 1 CUSTOMERS1 NET DEBIT BALANCES - 1969 - Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. -160 -20 100 -330 -170 -170 -60 100 30 -100 1970 - Jan.r/ Feb.r/ ~ Mar. jg/ -290 -110 -60 -30 -20 10 -30 .. -40 -30 -50 -50 -50 60 -150 -40 -20 Margin debt, as reported by the New York Stock Exchange. Although margin debt until March 1968 included loans secured by U.S. governments, the amount of such loans included is thought to have been small. "Bank loans to others than brokers and dealers for purchasing or carrying securities other than U.S. governments." The difference between customers' net debit balances and customers' net free credit balances, this figure represents the net credit extended by brokers and dealers to the nonfinancial public. NOTE: With the exception of bank loan data, figures are supplied by the New York Stock Exchange and are end of month data. Bank loans are for weekly reporting large commercial banks. Broker data includes loans for regulated securities; bank data includes loans for the purpose of purchasing or carrying any security, whether regulated or not. X TABLE 10: Savings Flows at Nonbank Depositary Intermediaries ($ m i l l i o n s ) DATE 1967 N 1968 1969 1969 - Feb. Mar. Apr. 1970 - Feb. > Mar. 2./ 1969 - Nov. Dec. 1970 - Jan. Feb. Mar. 2/ Apr. £/ 1 2 3 MUTUAL SAVINGS BANKS REGULAR DEPOSITS 3 NET • NEW ANNUAL MONEY 2 GROWTH NET FLOW RATE 1 5,082 4,208 2,551 331 642 -197 246 9.3 7.1 4.0 2,376 1,143 -747 264 81 -325 - - .• —— / 510 -100 272 229 4.9 4.1 -117 298 304 265 -2.1 5.4 5.5 4.7 150 -88 -230 -, --- SAVINGS . & LOAN ASSOCIATIONS NET SHARE CAPITAL ANNUAL NEW NET GROWTH MONEY 2 1 FLOW RATE Not Seasonally Adjusted 10,649 9.4 6,129 6.0 7,399 2,738 4,020 3.1 -1,003 605 1,370 -516 — -754 247 1,027 1,049 2.4 0.4 -6. 7 2.2 9.2 9.3 15,731 11,607 6,371 8,505 3,882 -1,749 936 2,012 -713 177 554 253 2,161 183 -' NET NEW MONEY 2 569 479 -543 —— 205 -1,661 283 Seasonally Ad lusted 265 47 TOTAL DEPOSITS ANNUAL NET GROWTH FLOW RATE 1 __ —— — 9.4 6.3 3.4 __ ; 451 327 466 23 537 276 3.2 1.3 -871 545 1,331 1,314 -5.2 3.3 7.9 7.8 Annual growth rate for monthly data is the annualized monthly percentage increase in deposits. Net New Money is new deposits net of both withdrawals and interest. Data for S&Ls are for insured associations only, which represent 96% of industry total resources. Regular deposits at mutual savings banks exclude items such as Christmas club and certain escrow accounts, which represent a very small part of total deposits. SOURCES National Association of Mutual Savings Banks and Federal Home Loan Bank Board. 833 56p 868 -- __ -- -- . 19 SAVINGS FLOWS (seasonally adjusted) Millions of dollars Monthly 2000 I\^ — - - /V V r TOTAL - \ T\ I \ M 1 1 1111M K - 1 - I.I l l-l.l. SAVINGS t LOANS ^ MUTUAL SAVINGS BANKS - 1 1966 " 1967 1 1968 1 1 1 1 1 1 1 1 1 1 1 1 1 M l 1 1 1 1 1 1 II 1969 1970 TABLE 11: Mortgage Commitments at Selected Thrift Institutions 1 DATE 1969 - Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. 1970 - Jan. Feb. Mar. 1 . OUTSTANDING COMMITMENTS 1 NET CHANGE ALL ALL MUTUAL | . SAVINGS. TOTAL SAVINGS & SAVINGS & TOTAL BANKS LOAN LOAN (N.Y. STATE) ASSOCIATIONS ASSOCIATIONS (Billions of Dollars, S easonally Adjusted) If 10.3 10.5 10.4 10.2 9.9 9.5 9.2 8.9 8.6 8.4 7.0 7.2 7.1 7.0 6.8 6.5 6.4 6.1 5.9 5,8 3.3 3.3 3.2 3.2 3.1 3.0 2.8 2.7 2.7 2.6 8.2 7.9 5.6 5.4 5.2 2.6 2.5 , , .18 .15 -.11 -.18 k32 -.36 -.31 -.33 -.24 -.25 -.17 -.31 . MUTUAL SAVINGS BANKS (N.Y. STATE) .12 .14 -.06 -.11 -.22 -.24 -.18 -.23 -.18 -.12 .06 .02 -.05 -.06 -.10 -.12 -.13 -.09 -.06 -.13 -.22 -.23 -.17 .04 -.07 Based on data from Federal Home Loan Bank Board and Savings Banks Associations of New York State. Data for savings banks and S&L's include a minor amount of nonresidential commitments. S&L commitments include loans in process. Net changes are derived directly from unrounded outstandings levels as reported and after seasonal adjustment by Federal Reserve. Subtotals may not add to totals because of rounding. MORTGAGE COMMITMENTS OUTSTANDING (seasonally adjusted) Monthly Billions of dollars TIT TOTAL N Y MSB'S Includes building loans beginning August 1967 1960 1962 1964 1966 1968 1970 TABLE 12: Net Change in Mortgage Holdings 1 SATE 1966 1967 1968 1969 TOTAL INCLUDING FNMA-GNMA TOTAL FINANCIAL INSTITUTIONS MUTUAL SAVINGS & COMMERCIAL SAVINGS LOAN BANKS BANKS ASSOC. Not Seasonally Adjusted LIFE INSURANCE COMPANIES FNMA-GNMA 18,197 19,988 23,827 23,485 15,874 18,191 21,319 19,110 4,705 4,639 6,677 5,152 2,760 3,118 2,796 2,495 3,761 7,520 9,350 '9,407 4,648 2,914 2,496 2,056 2,323 1,797 2,508 4,375 1969 - Jan. Feb. Mar, 1,701 1,750 1,964 1,500 1,529 1,759 451 480 519 293 228 198 622 671 917 134 150 125 201 221 205 1970 - Jan..Feb. 1,091 1,149 n.a. • 487 616 n.a. 100 100 0 38 106 153 136 223 213 187 n.a. 604 533 529 Mar. 317 Seasonally Adlusted 1969 - Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. j Dec. 2,202 2,099 2,117 2,032 2,153 1,698 1,910 1,876 1,734 1,652 1,906 2,025 1,906 1,910 1,808 1,875 1,364 1,380 1,365 1,1661,069 1,292 668 632 567 534 440 151 310 383 244 237 347 266 230. 246 251 230 181 157 137 124 146 235 884 875 899 854 1,022 859 720 654 627 547 576 207 159 194 169 183 173 193 191 171 139 134 1970 - Jan. Feb. Mar. 1,493 1,604 937 1,105 n;a. 288 285 114 24 143 197 400 436 276 225 241 l 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 real estate loans outstanding as available. Other data derived from mortgage debt outstanding as reported separately by National Assn. .of Mutual Savings Banks, Federal Home Loan Bank Board, Institute of Life Insurance and, through August 1968, the Federal National Mortgage Association, and thereafter by FNMA and the Government National Mortgage Association. Data for mutual savings banks and for Life Insurance companies may differ somewhat from those derived from.regular quarterly series because of minor conceptual differences 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) Monthly Billions of dollars 3.0 2.5 TOTAL, ING|_. FNMA - GNMA 2:0 FINANCIAL INSTITUTIONS 1.5 1.0 1967 1968 1969 1970 TABLE 13: Net Increases in Mortgage Debt Outstanding Billions of dollars, SAAR QUARTER TOTAL RESIDENTIAL 3 1- to 4FAMILY MULTIFAMILY 1 COMMERCIAL MULTI-AND COMMERCIAL FARM 1966 - If/ II III IV 28.5 24.3 18.7 15.2 19.2 15.6 11.0 9.2 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 1967 , - If/ IIP nil > IVp 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 1968 r 11/ Hp III]> IVp 27.1 25.9 26.5 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 30.4 !£/ Hp 28.5 III]> 26.4 IVp 24.0 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 • x 1969 1 2 - 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 TOTAL RESIDENTIAL 1-4 FAMILY COMMERCIAL MULTIFAMILY 1966 1968 1970 TABLE 14: FN MA ''Auction" Results COMMITMENTS IN $ MILLIONS IMPLICIT YIELD 2 (per cent) ACCEPTED 1-YEARll TOTAL TOTAL 9069061-YEAR 1 OFFERED DAY MONTH & OVER DAY MONTH & OVER 581.4 297.8 37.7 187.3 72.8 9.37 9.29 9.26 ' WEEK ENDED Jan. 26 Feb. 9 24 497.0 438.1 295.3 279.9 41.2 52.7 188.0 150.4 66.1 76.8 9.23 9.20 9.28 9.25 9.15 9.13 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 9.13 9.12 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 11 443.3 195.5 ,.,43.5 (100.0)2/ 121.1 38.9 9.01 ?.04 9.10 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 to 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 YEAR AND OVER 50 3 MONTHS IMPLICIT YIELD 6-MONTH COMMITMENTS • ' 1 • 1 1 1 ' — 1 1 1 1 1 1 1 80^ 600 TOTAL BIDS RECEIVED 400 200 TOTAL BIDS ACCEPTED JUNE AUG. 1969 OCT DEC. 0 FEB. APR. JUNE 1970 AUG. OCT. DEC. TABLE 15: Private Housing Starts and Permits STARTS DATE UNADJUSTED TYPE OF FINANCING SEASONALLY ADJUSTED ANNUAL RATE TOTAL 1 -FAMILY 2 OR MORE ,402 824 797 877 826 803 752 828 766 762 776 764 708 656 681 626 624 653 624 518 626 131.9 159.0 155.5 147.3 125.2 124.9 129.3 123.4 94. 6 84.1 18.9 23.0 21.1 21.5 20.8 22.4 18.3 25.1 18.8 23.2 1,059 1,301 1,383 577 722 690 482 579 693 66.4 74.0 113.8 16.5 17.5 25.2 1969 - Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. 1,588 1,505 ,533 ,507 ,429 ,376 ,481 ,390 1970 - Jan. Feb. Mar. ,280 BUILDING PERMITS (SEASONALLY ADJUSTED .ANNUAL RATE) 2 4.2 109.1 131.6 130.1 121.2 99.7 98.3 106.2 93.3 74.7 57.9 1,421 1,502 1,323 1,340 1,228 1,245 1,201 1,183 1,191 1,239 3.4 3.9 4.8 46.5 52.6 83.8 1,013 1,137 1,117 3.9 4.4 4.3 4.6 4.7 4.2 4.8 5.0 3.9 Total starts _axe Census estimates including farm "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. FHA and VA starts are units started under commitments by these agencies to insure or guarantee the mortgages. As reported by FHA and VA,. a unit is started when a field office receives the first compliance inspection report, which is made before footings are poured in some cases but normally after the foundations have been completed. Other starts are derived as a residual, although total and FHA and VA starts are not strictly comparable in concept or timing; other starts include both units financed by conventional mortgages and units without mortgages. Building permits 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. A 29 PRIVATE HOUSING STARTS AND PERMITS Monthly, annual rates Millions of units SEASONALLY ADJUSTED 2.0 HOUSING STARTS 1.6 1.2 / PER CENT OF UNADJUSTED TOTAL STARTS rSUILDING PERMITS (in issuing areas) MULTI-FAMILY • (2 or more) GOVERNMENT UNDERWRITTEN 1964 1966 1968 1970 TABLE 16: Mortgage and Bond Yields FHA MORTGAGES . 2 DATE 25-YEAR 30-YEAR CONVENTIONAL MORTGAGES 3 ' SPREAD BETWEEN YIELDS ON C0NV f & FHA MORTGAGES 1 NEW Aaa CORPORATE BONDS 4 SPREAD BETWEEN YIELDS ON NEW CORPORATE BONDS ' AND FHA MORTGAGES 1959-60 - High 1961-66 - Low 1966 - High 1967 - High Low 1968 - High Low 1969 High Low 6.26 5.43 6.73 n. a. n. a. n. a. n. a. n. a. 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 .U -.12 .12 -.27 .40 .13 5.25 4.41 5.82 6.51 5.18 6.79 6.15 8.75 6.91 . 1.69 . 77 1.16 1.28 .27 1.20 .26 1.08 -.13 1969 - D e c . n. a. 8.62 8.35 -.27 8.75 -.13 8.46 8.55 n. a. 1970 - Jan. .99 . 8.30 9.29 8.55 n. a. -.74 Feb. • .60 -.65 8.60 9.20 8.55 n. a. Mar. .50 8.60 9.10 8.55 -.55 n. a. Apr.i l Neither mortgage nor bond yields include allowance fon_servicing costs which aremuch, higher for mortgages than for. bonds. Generally, bonds pay interest semiannually; mortgages, monthly. Mortgage yields,,if computed as equivalent to - a semi-annual interest investment, would be- slightly higher than given in the table. , -2 Based on FHA-field-office opinions about average bid prices in the private secondary market for new-home mortgages for immediate delivery. Separate data available for 25-year and—beginning July 1961--30-year mortgages with minimum downpayments, weighted by probable volume of transactions. Yields computed by FHA, assuming prepayment period of 12 years for 25-year mortgages and 15 years for 30-year mortgages. 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 HOME MORTGAGES CONVENTIONAL Aaa CORPORATE BONDS NEW ISSUES H 111 11 11111 11 l-H I li I I 11 YIELD SPREAD(FHA MORTGAGE VS. NEW ISSUE Aaa CORPORATE BONDS) 200 i 1111 u 11111 111111111111 100 1962 1964 1966 1968 1970 T A B L E 17: Conventional Mortgage Terms DATE NEW HOMES CONFEES & C H A R G E S EFFECTRACT MATURITY RATE (PER (YEARS) TIVE (PERCENT) RATE CENT) 2 3 1 LOAN/ PRICE LOAN RATIO AMT. (PER ($000) CENT) 4 EXISTING H O M E S FEES & CONLOAN/ T R A C T CHARGES E F F E C - M A T U - PRICE (PER RATE TIVE RITY RATIO CENT) RATE (PER (YEARS) (PER CENT) CENT) 2 : 3 73 .8 72 .6 73,. 2 73..0 7.35 7.46 7.54 7.64 0.84 0.85 0.83 0.86 7.79 7.90 7.92 0.91 0.93 0.92 7.79 7.94 8.05 8.08 23.0 23.0 22.7 22.8 22.8 22.6 22.2 7.98 8.00 8.08 0.91 0.90 0.93 8.13 8.15 8.24 22.2 22.6 22.9 8.13 0.94 1.02 8.29 8.41 22.4 22.4 1.27 8^48 22.7 LOAN AMT. ($000) 4 1969 Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. 7.32 7.47 7.62 7.65 7.76 25.4 25.8 25.6 7.76 7.86 7.89 0.93 0.96 0.88 0.84 0.92 0.86 0.92 7.91 8.00 8.05 25.5 25.2 25.3 7.98 7.97 8.07 0.89 0.96 1.06 8.13 8.13 8.25 25.3 25.3 25.4 8.34 8.41 8.51 7.47 7.50 7.62 25.8 24.0 72.,0 72.,3 72.,4 72. 9 72. 8 71. 9 24.8 25.0 24.9 24.5 24.3 24.7 25.0 24.6 25.0 25.0 25.2 69. 3 71,.8 25.1 24.9 25.2 71. 6 25.4 7.49 7.60 7.68 72.7 71.8 71.9 71.4 71.7 71.2 70.7 70.2 70.4 70.6 20.2 19.9 19.7 20.1 20.1 19.8 19.2 19.5 20.1 20.8 m O Jan. Feb. 8.16 1.08 8.23 "1.09 Mar. 8.28 1.36' 8.23 8.26 70.3 20.5 70.2 . 2 0 . 4 20.6 70.7 1 Compiled by Federal H o m e L o a n B a n k Board in cooperation with Federal Deposit Insurance Corporation. Data are weighted averages based on probability sample survey of characteristics of conventional first m o r t g a g e s originated by major institutional lender groups (including mortgage c o m p a n i e s ) for purchase of single family homes. Data exclude loans for refinancing, reconditioning or modernization; construction loans to home-builders; and permanent loans which are coupled with construction loans to ownerbuilders. Related series on conventional m o r t g a g e rates only, based on unweighted opinions of field-office directors of the Federal H o u s i n g Administration, are available somewhat sooner than the results of the FHLBBrFDIC survey, and are included-in the case -of'new home m o r t g a g e rates--in Table 16. q 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 30 MATURITY NEW 25 EXISTING 20 I ii i i i i i i i i i i I i i i i i i i i i i i l 15 80 LOAN/PRICE RATIO NEW 75 EXISTING 70 I i i i i i I i i i i i 1 i65 i i i i i i i i Thousands of dolliars LOAN AMOUNT 30 NEW 20 EXISTING 10 1 I 1964 J—! 1966 1 196# I ii i i i i i i i i i I i i i i i M i, i i i 1970 * CHANGE IN SERIES