Full text of H.16 Capital Market Developments : May 26, 1969
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DECONTROLLED AFTER 8 H MORTBS CAPITAL MARKET _____ DEVELOPMENTS C o p i t g l Markets Section, D i v i s i o n of Research and S t a t i s t i c s , Board of Governors of the Federal Reserve System, Washington, D. C. INDEX 3-5 Developments in the Corporate and Municipal Bond Markets 6-7 C a p i t a l Market Y i e l d s 8-13 Capital Market Volume 14-17 Stock Market 18-33 Mortgage Market TABLE 1: Yields, Volume and Reception CORPORATE BOND MARKET VOLUME;2 PER CENT GROSS SOLD BY END BONDS SCHEDULED MOODY'S Aaa OFFERINGS OF WEEK WITHIN 23 DAYS YIELDS WEEK ENDING: NEW ISSUE 1 1968 - Apr. 11 18 25 May 2 9 16 23 30 e/ 7.30 7.02 6.97 6.88 6.81 -- 7.18 7.10 7.08 7.28 n. a. 6.80 6.79 6.75 6.78 307 176 372 100 95 79 227 184 374 r/197 130e 96 88 85 r/78 n.a. 548 437 478 870 630 983 926 n.a. MUNICIEAL BOND MARKET VOLUME 2 PER CENT BONDS SCHEDULED SOLD BY END GROSS BOND BUYER OF WEEK WITHIN 28 DAYS 20 BOND INDEX OFFERINGS YIELDS WEEK ENDING: 1968 - Apr. 11 18 25 May 2 9 16 23 30e/ MOODY'S Aaa 5.08 5.00 4.95 4.95 4.95 5.10 5.30 n.a. - 5.29 5.13 5.09 5.10 5.17 5.31 5.46 n.a. 420 345 415 191 r/185 ~ 267 r/352 250e „ 87 69 71 791 705 550 59 54 64 r/63 n.a. 770 886 943 527 n.a. 1 Derived by adjusting to an Aap 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, an^bonds guaranteed by the Federal Government.) /' 2 Millions of dollars unless otherwise indicated. n. a.-- Not available. Estimated. X TABLE 2: Details on Inventories DATE OFFERED . 5/22 5/20 5/20 5/19 5/16 AMOUNT (MIL, $) 30 25 8 25 50 CORPORATE BONDS IN SYNDICATE END OF LATEST WEEK ORIGINAL RATING AND YIELD CALL PROTECTION COUPON ISSUER Houston Light & Power 7-1/2 7.375 Aaa 5 years Pacific Bower & Light 1st 8 7.85 Baa 5 years Interstate Pwr. 1st 7.65 7-3/4 A 5 years Kentucky Utilities 1st 7-5/8 7.50 Aa 5 years Southern National Gas Debs4 7-65 7.65 Aa 5 years ESTIMATED PROPORTION SOLD 33% 50% 35% 75% 80% I DATE. OFFERED | RELEASED 5/14 5/19 40.0 Wisconsin Elec. Pwr. 7-1/4 INVENTORIES 1 MUNICIPALS BLUE LIST | IN SYNDICATE DATE 1969 - Apr. May CORPORATE BONDS RELEASED FROM SYNDICATE DURING LATEST WEEK ORIGINAL INCREASE RATING AND ESTIMATED PROCOUPON ISSUER . AMOUNT IN YIELD CALL PROT. PORTION RELEASED YIELD 25 2 9 16 23£/ 457 513 520 r/583 ~ 553 110 132 r/159 7/198 215 N.C. - No call protection, p Daily average of three days ended Wednesday. others as of Friday; in millions of dollars, r/ Revised. 7.25 18 Aa 5 yrs. CORPORATES IN SYNDICATE 1 93 76 59 44 54 i Blue List is daily average; 50% BONDS IN SYNDICATE Millions of dollars I I .1 lllllll ill JUN. 1968 DEC. MAR. JUN. 1969 SEPT. DEC. • ' ' TABLE 3: High Grade Bond Yields NEW CORPORATE MOODY'S SEASONED ISSUES(ADJUSTED ! CORPORATE Aaa 1 TO Aaa BASIS) DATE ••: ' U.S. GOVERNMENT 20-YEAR CONSTANT MATURITIES 2 ' \ SEASONED STATE AND LOCAL GOVERNMENT Aaa 3 1967 - H i g h Low 6.55(12/8) 5.11(2/10) 6.24(2/29) 5.00(2/10) 5.73(11/7) 4.48(1/20) 4.15(12/28) 3.25(2/9) 1968 - High Low 7.02(12/13) 6.13(8/30) 6.53(1/27) 5.95(9/13) 5.90(1/20) 5.18(8/9) 4.57(12/26) 3.80(8/8) 1969 - High Low 7.57(3/21) 6.90(2/21) 6.99(4/3) 6.55(1/3) 6.27(3/21) 5.96(1/24) 5.30(5/22) 4.57(1/2) 7.07 6.81 5.95 4.95 1969 - A p r . 25 May .' 2 7.18 6.80 5.98 4.95 9 7.10 ... 6.79 5.92 ' 4.95 16 7.08 r/6.01 6.75 5.10 23p/ 7.28 6.78 6.01 5, i n p Preliminary, r / Revised. V Weekly average of daily figures. Average term of bonds included is 22-24 years. •2 Weekly average of daily figures. 3 Thursday figures. Only general obligation bonds are included; average term is 20 years. SOURCE: MOODY'S INVESTORS SERVICE Note—Highs and lows are for individual series and may be on different dates for different series. HIGH GRADE BOND YIELDS NEW CORPORATE Aaa MOODY'S V* CORPORATE Aaa U.S. GOVT. 20-YR. CONSTANT MATURITIES MOODY'S MUNICIPAL Aaa 1965 1966 1967 1968 1969 TABLE 4: Long:term Corporate and State and Local Government Security Offerings and Placements (In millions of dollars) GROSS PROCEEDS CORPORATE1 PERIOD January February March April May June 1969p 1968p 1967 1969 p 1968p 1967 r/2,075 r/2,045 2,098 1,771 1,608 1,799 1,684 1,418 2,362 1,260 986 525 1,178 1,158 1,404 1,492 1,236 1,450 1,428 1,866 2,411 2,015 1,518 2,674 1,625e/ 9751/ 900e/ 1,318 1,143 1,395 1,130 1,254 1,497 2,143 1,432 1,557 2,589 2,481 1,763 1,469 1,699 1,444 950 860 1,340 6,218 6,810e/ 2,129 1,7.67 2,054 2,409 1,500 2,385 2,230 1,021 1,115 975 1,401 1,182 6,218 6,810e/ 5,178 5,704 5,133 5,950 5,464 6,208 6,832 6,294 3,740 3,856 4,612 4,366 4,177 3,881 3,150 3,557 10,882 16,015 21,965 11,672 18,504 24,798 7,956 12,008 16,574 8,059 11,209 14,766 2,410*/ 2,100%/ 2,300e/ July August September October November ..December 1st 2nd 3rd 4th Quarter Quarter Quarter Quarter 1st half .Three quarters Year STATE AND LOCAL 2 2,771 3,500e/ Excluding finance companies 3 1st 2nd 3rd 4th Quarter Quarter Quarter Quarter 5,308 6,063 6,584 5,859 23,814 Year e p 1 2 3 5,107 5,427 4,785 Estimated by Federal Reserve. Preliminary. Securities and Exchange Commission, estimates. of gross proceeds. Investment Bankers Association of America•estimates of principal amounts. Total new capital issues excluding offerings of sales and consumer finance companies. TABLE 5: New Corporate Security Issues, Type of Issue and Issuer (In millions of dollars) QUARTER OR ' MONTH 1968 - I II III IV 1969 - I lie/ 1968 - Apr. May June July Aug. Sept Oct. Nov. Dec. 1969 - Jan. Feb. Mar. Apr. e/ TOTAL 5,178 5,705 5,133 5,951 6,218 1,428 1,867 2,418 2,144 1,433 1,556 2,129 1,767 2,055 2,075 2,045 2,098 2,360 GROSS PROCEEDS BY TYPE OF ISSUE COMMON AND PUBLICLY PRIVATELY PFD. ISSUES INCLUDED MFG. OFFERED PLACED STOCK FOREIGN CONVERTIBLE hm 1,724 1,644 1,361 1,922 1,539 989 956 1,166 1,474 2,023 313 172 124 113 215 584 758 1,037 902 1,355 719 ' 1,046 1,340 1,244 637 727 1,009 939 607 r/ 980 842 835 1,260 438 521 685 528 400 433 595 362 965 r/636 r/395 508 500 271 300 385 372 396 398 525 466 483 jr/460 r/808 755 600 31 89 52 47 49 28 24 49 40 r/103 74 38 139 380 239 605 2,465 3,105 2,606 211 221 365 211 326 r/376 r/578 401 GROSS PROCEEDS BY TYPE OF ISSUER PUBLIC UTILITY COMMUNICATIONS OTHER ISSUERS 1 1,907 1,703 657 1,712 1,407 1,442 1,244 1,160 1,435 1,346 422 536 490 319 473 1,407 2,223 1,825 2,483 2,991 373 563 767 843 362 453 640 421 651 r / 403 r/513 491 430 180 557 507 239 446 475 674 443 319 627 Mr/315 r/404 520 192 104 239 239 95 156 115 162 41 186 56 231 50 683 642 898 822 530 472 700 741 1,044 r/860 r/1,161 970 1,360 p Preliminary. e Estimated by Federal Reserve. 1 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. TABLE 6: Large Long-term Public Security issues for New Capital (Other than U.S. Treasury) . ISSUER TYPE 2 AMOUNT (MILLIONS OF DOLLARS) MATURITY May 1 through May 23, 1969. COUPON \ RATE OR OFFER- MOODY'S RATING NET INTERING EST COST YIELD Corporate Columbus & Southern Ohio Electric Company Union Electric Company Teledyne, Inc. Western Union Telegraph Co. C. & P. Telephone Co. of West Virginia Hoener Waldorf Corp. Tappan Company V Homestake Mining Co. Southern Natural Gas Co. Burroughs Corp. Fruehauf Corp. Cincinnati Gas & Elec. Co. Hammermill Paper Co. Wisconsin Electric Pwr. Co. U . S . Realty Investment Mid-Continent Realty Corp. Pacific Pwr. & Lt. Co. Kentucky Utilities Co. Tandy Corp. Dial Finance American Enka Corp. Houston Lighting & Pwr. Co. Debs. 1st mtg. bds. Debs. Com. stk. 25.0 35.0 30.0 65.0 1999 1999 1994 7-5/8 7-3/8 7-7/8 7. 50 7. 25 8.00 Debs. Conv. debs. Conv. debs. Com. stk Debs. Conv. debs. Conv. debs. 1st mtg. bds. Conv. debs. 1st mtg. bds. Conv. debs. Conv. debs. 1st mtg. bds. 1st mtg. bds: Conv. debs. Debs. Conv. debs. 1st mtg. bds. 40.0 30.0 20.0 18.9 50.0 100.0 60.0 50.0 30.0 40.0 20.0 16.0 25.0 25.0 35.0 15.0 45.0 40.0 2009 1994 1994 7-1/4 5 5-1/2 7. 20 5.00 5. 50 Aaa Ba Ba 1972 1994 1994 1999 1994 1999. 1989 1989 1999 1999 . 1989 .1989 1994 1999 7.65 4-5/8 5-1/2 7-3/8 5 7-1/4 5-3/4 5-1/2 8 7-5/8 5 8-1/4 5-1/4 7-1/2 7. 65 4. 63 5..50 7.,20 5.,00 7.,25 5.,75 5,,50 7. 85 7. 50 5.,00 8.,25 5.,25 7..375 A Baa Ba Aaa Ba Aa \ * A Aa. Baa —- Baa Aa Ba Baa ! . TABLE 6: Large Long-term Public Security Issues for New Capital (continued) (Other than U.S. Treasury)1 May 1 through M a y 2 3 1 9 6 9. ISSUER . TYPE AMOUNT (MILLIONS OF DOLLARS) MATURITY COUPON RATE OR NET INTEREST COST OFFERING YIELD MOODY'S RATING State & local Government 4.82 4.00-5. 40 12.0 1970-94 Winston-Salem, IT. C. Aa G.O. 4.98 4.10-5. 05 11.5 1970-84 Hawaii, State of A G.O. 4.00-5. 30 1970-89 4.92 12.0 Aa Madison, Wisconsin G.O. 1970-99 5.74 5.10-5. 85 35.0 Baa Denver, Colorado Rev. North Penna. Sch. Dist. 5.70 6.5 5.75 Rev. 1999 Auth., Penna. A North Penna. Sch. Dist. ,60 5.70 4.10-5. 1970-91 8.4 A Auth., Penna. Rev. 5.02 4.10-5.,40 42.9 Delaware, State of A G.O. -23.5 5.34 4.25-5.,60 Prince George's Co., Md. 1970-94 A G.O. 5.65 4.25-5..70 15.0 1970-89 Alabama Highway Authority Rev. A-l . 4.70-5,.25,6 N.R. 40.0 Hawaii, State of Rev. 1972-79,,1994 5.93 5.07 4.20-5 .20 1970-89 Aa 11.9 Worchester, Mass. G.O. 5.20-6 .40 6.49 1980 35.0 Rev. Cobb County, Ga. ' 4.25-5 .55 Aaa 1970-2009 182.3 Bonds H.A.A. Nashville & Davidson Co. 4.70-5 .70 5.89 1984 A 11.0 Rev. Metro. Gov't., Tenn. Other 2/ 7-3/4 7.87 1974 Debs. Quebec, Province of 8.00 7.87 35.0 1999 Debs. Ouebec. Provin<?pl Rights offering. N.R. -- Not rated. Includes corporate and other security offerings of $15 million and o v e r ; State and local security offerings of $10 million and over. Includes foreign government and International Bank for Reconstruction and Development issues and non-guaranteed issues by Federal Agencies. 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 bond^ 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. TABLE 7: Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U.S. Treasury)1 f Mav 23. 1969. ISSUER AMOUNT (MILLIONS OF DOLLARS) TYPE APPROXIMATE DATE OF OFFERING Corporate Jersey Central Pwr.&Lt. Co. 1st mtg. bds. Southern New England Tele.Co Debs. 1st mtg. bds. Long Island Lighting Co. 1st mtg. bds Va. Electric & Power Go. Va. Electric & Power Co. Pfd. stk. Bds. ^Virginia Elec. & Pwr. ^ 1st mtg. bds Consumers Power Co. Rev. Perina. Electric Co. 1st mtg. Penna. Power & Light Co. *Colorado Interstate Corp. Bds. Debs. Beneficial Finance Wisconsin Power & Light 1st mtg. 1st mtg. bds . Florida Power & Light Co. 1st mtg. bds, Illinois Bell Tele. Co. Indiana & Michigan Elec. Co.Bonds South Carolina Elec. & Rev. Gas Co. 1st mtg. Washington Gas Light Co. 1st mtg. West Penna. Power Co. Pfd. stk. Consumers Power Co. 1st mtg. bds. D'uquesne Light Co. Rev. Hawaiian Telephone Co. Conv. debs. Vernitron Corp. Conv. debs. Performance Systems Inc. - May May May June June J une June June June June June June June June June 33.0 65.0 40.0 75.0 35.0 75.0 50.0 28. 0 40.0 30.0 50.0 25 . 0 50.0 150.0 60.0 35.0 20.0 25.0 35.0 30.0 25.0 20.0 15.0 r ' 26 27 28 3 3 3 4 5 9 10 10 10 12 17 18 June 19 June 23 June 24 June 25 June 25 June 26 Indefinite Indefinite State & local Government G.0. Ohio, State of *Penna., State of G.0. G.0. New Hampshire Wheeler Ridge Maricopa Wtr. Rev. Dist., California G.0. Phila. Sch.-Dist., P4. G.0. Albany Co., N. Y. Rev. *0cala, Florida. Los Angeles Dept. of Rev. Wtr. & Pwr. G.0. & Rev. Jefferson Parish, La. Rev. ^Tallahassee, Florida Rev. Shreveport, La. G.0. *NaSsau Co., New York G.0. Richmond, Virginia *Dallas I.S.D., Texas iG.0. 27 27 75, .0 78..0 36..5 May May May 13..0 30..0 70..0 16.,1 June June June June 1 3 3 3 39. 0 17.,5 12. 0 14.,0 42. 1 17. 0 12. 0 June June June June June June June 4 5 10 10 10 11. 11 < TABLE 7: Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U.S. Treasury)! . - ISSUER TYPE AMOUNT (MILLIONS OF DOLLARS) APPROXIMATE DATE OF OFFERING State & local Gov't. (Continued) Penna. Higher Education Facilities Auth. King Co., Washington ^University of Calif. Newark, New Jersey Minnesota, State of G.O. G.O. Rev. Bd. G.O. G.O. 22.1 28.3 16.2 20.5 33.8 June 17 June 17 June 18 June 24 Indefinite Other City of Edmonton *F ,M.N. A. ' Canadian Pacific Railway Co. Tennessee Valley Auth. *Argentine Republic *Alberta Gov't. Tele. Comm. S.F. debs. Debs. 25.0 200.0 May May 28 28 Equip. Rev. Bds. Debs. 30.0 100.0 25.0 30.0 J une 3 June 3 June 17 June 11 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. TABLE 8: Stock Prices and Volume TRADING VOLUME T STOCK PRICES 1 DATE S&P, 500 1967 -High Low AMEX NYSE AMEX 943.08(9/25) 786.41(1/3) 24.52(12/29 13.78(1.27) 12.3(12/29) 6.9(1/6) 2.1(1/6) 1968 - High Low 108.37(11/29) 985.21(12/3) 87.72(3/5) 825.13(3/21) 33.25(12/20 22.00(3/22) 17,1(7/12) 13.5(5/9) 92.(5/31) 8,0(1/31) 1969 - High Low 105:94(5/16) 97.98(2/25) 968.85(5/14) 899.80(2/25) 32.91(1/3) 29.46(3/7) 13.5(5/9) 9.2(2/14) 8.0(1/31) 3.8(2/14) 1969 - Apr. 25 101.72 924.00 30.09 11.3 4.9 2 104.00 9 105.05 16 105.94 23dli.04.59 957.17 961.61 967.30 947.45 30.93 31.26 31. 28 31.11 14.5 13.5 12.4 11.4 7.3 7.7 6.5 5.6 May 97.59(9/25) 80.38(1/3) 6.7(10/27) Preliminary. Figures, except highs and lows are Friday's only. Highs and lows are for the year and are not necessarily for Friday's. Averages of daily trading volume on the New York and American Stock Exchanges. Millions of shares. 1941-43 = 10 . =Based on actual dollar value, rather than a formula. STOCK PRICES AND TRADING VOLUME D.J. dnd.) S&P (500) STOCK PRICES AMEX PRICE LEVEL INDEX AMEX TRADING VOLUME NYSE TRADING VOLUME 1965 1966 1967 1968 1969 1040 104 980 98 920 92 860 86 800 80 740 74 TABLE 9: Stock Market Credit CUSTOMERS' CREDIT EXTENDED TO CUSTOMERS BY: NET DEBIT BROKERS 1 | BANKS 2 | TOTAL BALANCES END OF PERIOD NET CREDIT CUSTOMERS' NET EXTENDED BY FREE CREDIT BROKERS AND DEALERS 3 BALANCES Outstanding: 1968 - Mar. 6,190 Apr. 6,430 May 6,640 June 6,690 July 6,500 Aug. 6,460 Sept. 6,390 Oct. 6,250 Nov. 6,200 Dec. .6,200 1969 - Jan. 5,930 Feb. r/5,750. Mar. r/5,600 Apr. £/ " 5,630 2,370 2,350 2,360 2,410 2,420 2,490 2,520 2,560 2,630 2,710 2,750 2,810 2,781 2,763 8,560 8,780 9,000 9,100 8,920 8,950 8,910 8,810 8,830 8,900 8,680 r/8,560 r/8,381 8,393 7,248 7,701 8,268 8,728 8,861 8,489 8,724 8,859 9,029 9,970 9,107 9,148 r/8,318 8,044 2,692 2,979 3,064 3,293 3,269 2,984 3,126 3,407 3,419 3,717 3,597 3,647 3,294 3,077 4,556 i 4,722 ! 5,204 5,435 5,592 5,505 5,590 5,452 5,610 6,073 5,510 5,501 r/5,024 4,967 - Change in , Outstanding: 1968 - Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. 1969 - Jan. Feb. Mar. Apr. 1 2 3. 40 240 210 50 -190 -40 -70 -140 -50 —— -270 -180 -150 +30 -50 -20 10 50 10 70 30 40 70 80 40 60 -29 -18 -10 220 220 100 -180 30 -40 100 20 80 -220 -120 -179 +12 -171 453 567 460 133 -371 235 135 170 761 -683 -51 -830 -274 -76 287 85 229 -24 -285 142 281 12 298 -120 50 -351 -217 -85 166 482 231 156' -86 85 -138 158 563 -501 -9 -477 -57 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. TABLE 10: Savings Flows at Nonbank Depositary Intermediaries ($ millions) MUTUAL SAVINGS REGULAR DEPOSITS ANNUAL GROWTH N ET • RATE 1 FLOW DATE TOTAL DEPOSITS ANNUAL NET GROWTH RATE 1 FLOW 5c LOAN ASSOCIATIONS SAVINGS , BANK& NET NET SHARE CAPITAL 3 NEW . ANNUAL' NEW , \ NET GROWTH MONEY 2 \ MONEY? 1 FLOW RATE Not Seasonally Adjusted 1966 1967 1968 2,557 5,082 4,186 ! 350 645 -75 1968 - Feb. Mar. Apr. 331 642 -200 Feb. Mar. • Apr. 2./ 4.9 9.3 7.0 __ — -- • 395 362 1969 - Jan. Feb. Mar. Apr. 2/ 1 2 3 p * ' 220 384 382. 157 \ 227 2,376 1,143 ... 3,584 10,687 7,396 3.2 9.4 5.9 -552 6,129 2,676 301 117 -189 584 1,275 -294 —— 559 541 -324 934 1,920 -369 860 658 -513 264 81 -325 605 r/1,3 70 r/ -492 569 r/524 r/- 536 . 986 r/2,012 1 r/-692 833 r/605 r/-8 61 — -- __ — -- Seasonally Adlusted 1968 - Nov. Dec. NET NEW " MONEY 2 7:5 6.8 . 620 620 4.1 7.2 7. 1 Z.9 523 4.8 582 ' r/5.3 r/3 95 "r^.lr/2 14 r/1,9 . --- 5.7 5.7 | 6,141 15,769 11,582 3.8 9.4 6.3 ' -325 8,505 3,819 1. —— -__ I —— -- 1,015 982 743 966 rA,2 77 r/ 3.71 6.3 6.1 4.6 5.9 r/7.8 r/2.2 Annual growth rate for monthly data is the annualized monthly percentage increase in deposits Net New Money is the net change in deposits net of both withdrawals and interest. Data for S&Ls are for insured associations only, which represent 96% of the total resources of the industry. Regular deposits at mutual savings banks exclude items such as Christmas club and certain escrow accounts, which represent a very small part of total deposits. SOURCE: National Association of Mutual Savings Banks and Federal Home Loan Bank Board, Preliminary. 1 .S&L series reflects FHLB revisions of data shown here through 1968. -- SAVINGS FLOWS (seasonally adjusted) Monthly - - Millions of dollars 2000 1600 .TOTAL 1200 800 400 400 / X SAVINGS & LOANS ' — — - 1 1 I II 1 ! M 1 1 ! 1 1 I 1 1 / ^ - v N I U T U A L SAVINGS BANKS - 1 1965 1 1966 1 1 I t 1 1 1 1 1 1 1 1 1 1 II I 1 II 1 1 1 1 1967 1968 1969 TABLE 11: Mortgage Commitments at Selected Thrift Institutions OUTSTANDING COMMITMENTS MUTUAL ALL SAVINGS SAVINGS', & BANKS . LOAN (N.Y. STATE) ASSOCIATIONS DATE TOTAL NET CHANGE . ALL SAVINGS & LOAN ASSOCIATIONS (Billions of Dollars, Seasonally Adjusted) 1968- Apr* May June July Aug. Sept. Oct. Nov. Den. 1969- Jan. Feb. Mar. 2/ Apr. jj>/ 8.7 8.6 8.6 8.8 9.0 9.1 9.5 9.7 9.7 6.2 6.0 5.9 6.1 6.1 6.2 6.4 6.5 6.6 2.5 2.6 2.6 2.7 2.9 2.9 3.0 3.2 3.1 • 9.9 10.1 10.3 10.5 6.7 6.9 7.0 7.2 3.2 3.2 3.3 3.3 •14 • -.13 -.04 .24 .16 .14 .35 .27 -.01 .15 .25 .17 . 18 1 MUTUAL SAVINGS BANKS (N.Y. STATE) 1/ .14 -. 16 -.10 .16 . 10 .22 .10 .08 .08 i 22 .09 .17 .07 .03 .08 .01 Based on data from Federal Home Loan Bank Board and Savings Banks Association of New York State. Net changes are derived directly from unrounded outstandings levels as reported and after seasonal adjustment by Federal Reserve. Savings and Loan data include loans in process. Subtotals may not add to totals because of rounding. • -- .02 .06 .08 .16 .04 .13 .17 -.10 \ 'i \ MORTGAGE COMMITMENTS OUTSTANDING (saar) BiVons of dollars Monthly • i i ' i r~~~i • i TOTAL S&L'S MSB'S 1959 1961 1963 1965 1967 :\ TABLE 12: Net Change in Mortgage Holdings 1 FINANCIAL INSTITUTIONS MUTUAL SAVINGS & COMMERCIAL SAVINGS LOANS BANKS BANKS TOTAL INCLUDING FNMA 1965 LIFE INSURANCE COMPANIES I II III IV 4,761 6,365 6,469 6,303 4,813 6,431 6,403 5,947 823 1,749 1,805 1,322 965 946 1,072 1,078 1,860 2,706 2,460 1,947 1,165 1,030 1,066 1,600 1966-- I II III IV 5,425 5,648 3,976 3,056 4,630 5,097 3,468 2,587 975 1,656 1,300 774 753 513 739 715 1,683 1,651 373 54 1,219 1,277 1,056 1,044 1967 - I II ' III IV 2,617 4,868 6,285 6,246 2,267 4,762 5,706 5,484 151 1,200 1,751 1,537 770 786 839 758 486 2,119 2,595 2,320 860 657 521 869 1968 1,768 1,989 2,227 2,125 1,851 1,982 2,000 2,314 2,088 2,483 1,494 1,743 1,992 1,905 1,699 1,841 1,892 2,153 1,943 2,311 400 616 616 616 533 533 746 807 706 404 137 160 203 219 248 233 221 313 310 340 789 879 957 901 718 . 874 810 845 732 903 168 88 216 169 200 201 115 188 195 664 1969 - Jan. r/1,750 Feb. 1,770 Mar.2/1 945 Tr.a. Apr." i/1,549 1,549 /l,740 r/500 500 r/500 600 293 228 198 n.a. 622 671 r/917 1,040 134 150 125 Mar. Apr. May June July Aug. Sept, Oct. Nov. Dec. " l 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 the Federal 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. NET CHANGE IN MORTGAGE HOLDINGS Monthly Billions of dollars 3.0 TOTAL, INCL. FNMA 2.5 2.0 1.5 FINANCIAL INSTITUTIONS 1966 1967 1968 1.0 1969 TABLE 13: Net Increases in Mortgage Debt Outstanding 1 (Seasonally Adjusted Annual Rate) 1- to 4- MULTIMULTI-AND COMMERCIAL FAMILY COMMERCIAL RESIDENTIAL2 FAMILY . : QUARTER 1965 - I II III •- IV TOTAL 24.9 25.2 25.8 26.6 18.6 18.5 19.3 19.6 15.1 15.1 15.5 15.8 3.5 3.5 3.8 3.8 4.2 4.5 4.4 4.6 1966 - I II III IV 28.4 23.6 17.8 14.9 19.0 15.3 10.6 9.2 14. 7 12.1 8.3 7.2 4.3 3.2 2.3 2.0 7.0 6.1 r 5.1 3.9 1967 - I II III . IV 15.5 20.4 26.3 28.5 9.9 13.7 19.1 20.8 6.8: 10.5 15.3 16.5 3.1 3.2 3.8 4.3 1968 - I II III IV 27.1 26.2 25.8 30.2 18.3 18.6 17.8 21.0 16.3 14.7 14.6 17.0 2.0 3.9 3.3 4.0 ~ 1 FARM 8.0 8.1 8.4 7.9 2.2 2.1 2.2 2.4 11.7 9.4 7.7 5.6, 2.4 2.2 2.1 1.7 3.8 4.8 4.8 5.1 7.3 8.0 8.8 8.8 1.8 1.9 2.4 2.6 6.3 5.3 6.2 7.7 8.6 9.3 9.8 10.8 2.5 2.3 1.8 1.6 / 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. 2 Residential mortgage debt JLncludes nonfarm only and is sum of 1 - to 4-family and multifamily mortgage delft'combined. ]>/ Preliminary. NET INCREASES IN MORTGAGE DEBT OUTSTANDING Quarterly Billions of dollars, seasonally adjusted annual rate TOTAL 24 TOTAL RESIDENTIAL 16 \—j / 1-4 FAMILY COMMERCIAL MULTIFAMILY 1965 1967 1969 TABLE 14: FNMA Weekly "Auction^ Results WEEK ENDED TOTAL OFFERED IMPLICIT YIELD AMOUNTS IN $ MILLIONS ACCEPTED 6| 12-18^' 3 6TOTAL 3^12-18-/ | MONTH 1f MOS. M0NTH MOS. MOS. MOS -Mar.3 10 17 24 118.9 127.1 132.7 220,9 90.5 84.6 88.5 84.1 11.5 7.5 3.1 3.5\ 38.1 37.0 45.6 47.4 41.0 40.2 39.8 33.3 8.13 8.14 8.09 8.10 8.17 8.13 8.08 8.09 Apr. 1 7 14 21 28 182.9 175.9 144.7 128.1 157.7 93.1 102.5 101.1 100.9 84.1 4.6 8.2 7.9 4.6 4.8 47.2 57.8 52.3 59.8 58.7 41.4 36.5 40.9 36.5 20.5 8.10 8.12 8.10 8.05 7.94 8.11 8.13 8.10 8.05 7.94 May 5 170.8 210.4 236.2 84.4 6.7 85.0 9.3 (83.3) ^ . 1 3 . 8 (85.0) 58.2 55.9 51.0 19.5 19.7 18.5 7.89 7.87 7.87 7.90 7.89 7.83 7.81 7.88 7.81 12 19 26£/ 8.02 8.00 7.95 7.96 . ' ' 7.98 8.01 7.98 7.93 7.86 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 folding of FNMA stock, assuming prepayment in 15 years for 30-year Government-underwritten mortgages. Yields shown are gross, before deduction of 50 basis point fee paid by investors to servicers. 3. FNMA announced limit of accepted bids for next week's auction. FNMA WEEKLY "AUCTION" RESULTS $ Millions 120 AMOUNT OF ACCEPTED BIDS BY COMMITMENT PERIOD 100 80 60 AND OVER 40 6 MONTHS 20 3 MONTHS Per cent -IMPLICIT YIELD — 8.6 6-MONTH COMMITMENTS 8.0 — 7.4 I I I I I i i •i - r i i i i i i l l 6.8 i $ Millions TOTAL BIDS RECEIVED TOTAL BIDS ACCEPTED JUNE OCT. AUG. 1968 DEC. FEB: APR. JUNE 1969 AUG. OCT. DEC. TABLE 15: Private housing starts and Permits STARTS DATE 1968 - Mar. Apr. May June July Aug. • Sept. Oct. Nov. Dec. SEASONALLY ADJUSTED ANNUAL RATE TOTAL 1-FAMILY 2 OR MORE 1,511 1.591 1.364 1.365 1,531 1,518 1.592 1,570 1,733 1,509 920 922 838 790 904 867 944 965 905 922 591 669 526 575 627 651 648 605 828 585 TOTAL 126.6 162.0 140.9 137.9 139.8 136.6 134.3 140.8 127.1 96.4 UNADJUSTED TYPE OF FINANCING FHA VA OTHER 19.6 4.5 20.5 19.8 5.5 5.0 20.9 4.8 21.4 17.5 16.3 5.3 4.2 4.4 22.6 5.4 18.8 4.9 18.6 4.6 102.4 134.0 114.9 113.1 116.2 110.9 111.1 114.0 105.4 75.7 BUILDING PERMITS (SEASONALLY . ADJUSTED ANNUAL RATE) 2 1,416 1,340 1,280 1,281 1.289 1.290 1,393 1,378 1,425 1,463 1969 - Jan. |l,878 1,066 812 101.5 14.2 3.8 83.5 1,403 90.0 1,686 975 1,477 Feb. 13.2 3.5 73.3 711 1,421 131.5 826 Mar. jl, 580 754 18.9 3.9 108.7 785 Apr. Il, 543 758 1,449 157.0 n.a. 4,4 Total starts are 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. apehart military housing units are excluded. 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. • Revised. p Preliminary. 29 PRIVATE HOUSING STARTS AND PERMITS Monthly, annual rates I Millions of units ' 2.0 SEASONALLY ADJUSTED DATA HOUSING STARTS 1.2 BUILDING PERMITS (in issuing areas) PER CENT OF UNADJUSTED TOTAL STARTS CHANGE IN SERIES 40 MULTI-FAMILY (3 or more) GOVERNMENT UNDERWRITTEN 1963 1965 1967 1969 TABLE 16: Mortgage-and Bond Yields FHA MORTGAGES DATE 1957 - H i g h 1958 - Low 1959-60 - High. 1961-66 - Low 1966 - High 1967 - High Low 1968 - High Low 1968- Nov. Dec. 1969 - Jan. Feb. - Mar. Apr. 1 NEW SPREAD BE- CONVENTIONAL TWEEN YIELDS Aaa CORON CONV. & PORATE MORT- . 25-YEAR 30-YEAR FHA MORTBONDS GAGES 3 GAGES 4 5 2 SPREAD BETWEEN YIELDS ON NEW CORPORATE BONDS AND FHA MORTGAGES 5.63 5.35 6.24 5.43 6.73 n. a. n.a. n.a. n.a. n.a. n.a. n.a. 5.44 6.81 6.81 6.29 7.52 6.78 6.00 5.55 6.30 5.80 . 6.70 6.65 6.40 7.30 6.75 .47 .15 .23 .25 .30 .11. -.12 .02 -.27 4.94 3.65 5.25 4.41 5.82 6.51 5.18 6.79 6.15 1.58 .88 1.69 .77 1.16 1.28 .27 1.20 .26 n.a. n.a. n.a. n.a. n. a. n.a. 7.36 7.50 7.30 7.40 7.55 . 7.60 7.65 7.75 -.06 -.10 6.61 6.79 6,92 6.91 7.35 7.20 .75 .71 1 —— 7.99 8.05 8.06 -- -.39 -.40 -.31 . — . 1.08 .70 .86 Neither' mortgage nor bond yields take into account servicing costs which are much higher for mortgages than 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 d^ta 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 office cities. 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 FHA mortgage yield data are for 25-year mortgages through June 1961; 30-year mortgages thereafter. 5 See note for Table I. (Data prior to 1965 is based on a composite of issues with and without call protection.) n.a. Not available. 31 MORTGAGE AND BOND YIELDS Monthly ' —r HOME MORTGAGES: CONVENTIONAL FHA Aaa CORPORATE BONDS: NEW ISSUES 1961 1963 1965 1967 1969 TABLE 17: Conventional Mortgage Terms NEW HOMES > . DATE CONFEES & T R A C T C H A R G E S EFFEC- M A T U R I T Y (PER RATE T I V E , (YEARS) CENT) RATE ' (PER CENT) 3 2 LOAN/ PRICE RATIO (PER LOAN AMT. ($000) CENT) 1 EXISTING HOMES CON- FEES & LOAN/ TRACT C H A R G E S EFFEC- MATU- PRICE (PER RATE TIVE RITY R A T I O (PER CENT) CENT) RATE 2 (YEARS) 3 LOAN AMT. ($000) (PER CENT) 1968 6 .50 6 .57 6,.69 <88 7,.04 7..10 7..10 7.,09 7.07 7.,09 0.88 0.88 0.95 0.95 0.85 0.87 0.87 0.88 0.84 0.89 7. 16 7.26 7.32 A p r . 2 / .7.46 0.84 0.81 0.93 0.98 Mar. Apr. May July Aug. Sept. Oct., Nov. Dec. 6 .64 25.7 . 6 .71 25.3 6,,84 25.0 7,.03 25.4 7,.17 25.5 7..24 25.5 7.,24 25.5 7.,23 . 25.6 7,,21 25.4 7.23 25.9 74 .3 22.2 73 .4 21.9 73 .2 21.-7 74,.4 22.3 73,.7 22.2 73..6 . 22.6 74.,2 22.1 74.,5 22.7 74.,1 22.5 74.0 24.7 6.59 6.64 6.81 6.97 7.10 7.12 7.11 7.09 7.07 7.09 0.79 0.80 0.87 0.86 0.83 0.85 0.82 0.84 0.82 0.85 6 .72 6 .77 6 .95 7.12 7.23 7 .26 7,.25 7,.22 7,.21 7..23 23.0 22.6 22.5 22.6 22.5 22.7 22.6 22.5 22.7 23.3 73.3 72.8 73.1 73.1 72.6 73.0 72.6 72.4 72.9 73.2 18.3 18.1 18.3 18.2 18.5 18.6 18.3 18.3 18.9 20.4 73.6 73.3 73.8 73.4 0.86 7.18 7.28 0.86 7.35 * 0.84 7.46 X).85 7.,32 7.42 7.,49 7.60 22.8 22.9 23.0 23.0 72.6 72.8 72.7 72.2 20.0 19.6 20.2 20.0 1969 Jan. Feb. , Mar. 7.30 7.39 7.47 7.62 p Preliminary 25.6 25.6 25.8 25.5 24.1 23.5 24.0 25.1 r Revised.. 1 C o m p i l e d by Federal H o m e L o a n Bank 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 m a j o r institutional lender groups, (including m o r t g a g e c o m p a n i e s ) for purchase of single family homes. Data exclude loans for refinancing, reconditioning, or m o d e r n i z a t i o n ; construction loans to home-builders; and--in this exhibit--permanent loans which are coupled with construction loans to owner-builders. Data prior to 1965 on a c o m p a r a b l e basis with the new series are pending. Related series on conventional m o r t g a g e rates only, based on unweighted opinions of regional-office directors of the Federal.Housing A d m i n i s t r a t i o n , are available somewhat sooner than the results of the FHLBB-FDIC survey, and are included-iri the case of new h o m e m o r t g a g e rates--in T a b l e 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. . " . ~ • CONVENTIONAL MORTGAGE TERMS Monthly Years 30 MATURITY NEW EXISTING 20 LOAN/FRICE RATIO NEW EXISTING 70 1963 1965 1967 1969 * CHANGE IN SERIES