Full text of H.16 Capital Market Developments : November 19, 1962

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\ot for_Publication ^CONTROLLED AFTER SIX MONTHS
H.14

*

yBRABY

November 19, 1962.
^])|TAT uaptot DEVELOPMENTS
IN THE UNITED STATES
(Including New Chart on New Corporate Bond Yields)

ttSEBVS BASE
Of filCHMOt®

blic security financing to obtain new capital was in substantial
volume last week but is expected to be quite light this holiday-shortened
week- During the week ending November 16, two large corporate security
issues totaling $70 million were offered and five State and local government
bond issues with par value of $129 million were sold. This week, ending
November 23, no large issues of either corporations or State and local
governments are scheduled to obtain new capital; however, a large secondary
distribution of about $87 million in General Motors Corporation common stock
is expected.

Bond yields. Changes in yields on seasoned, long-term bonds were
mixed but. minor last week. Yields on both Aaa- and Baa-rated corporate
bonds dropped a single basis point to 4.25 and 4.96 per cent, respectively,
their lowest levels since late-April 1961 and mid-May 1958. Aaa-rated State
and local government bond yields rose one basis point from their low of
the year to 2.89 per cent, while U. S. Government bond yields also rose a
single basis point to 3.87 per cent. Yields on Baa-rated municipals were
stable at 3.53 per cent.
Short- and intermediate-term interest rates. Changes in yields
on Treasury bills and 3-5 year U. Si Government obligations were also mixed
last week. Rates on 3-month bills were stable but those on 6-month bills
increased a basis point; as a result the spread between yields on 3- and
6-month bills narrowed further to 4 basis points, the lowest on record.
Yields on intermediate-term Government securities advanced 3 basis points.
The average rate of interest on directly-placed finance company paper with
90-17.9 day maturity rose 8 basis points to 3.11 per cent as all companies
increased their advertised rate by mid-week to the 3-1/8 per cent rate
adopted by several companies the previous week. The Federal funds rate
continued at 3.00 per cent. Other short- and intermediate-term interest
rates were unchanged.
Mortgage yields. Secondary market yields on 25-year 5-1/4 per cent
FHA mortgages dropped 2 basis points further in October; the average of 5.54
per cent was down 18 basis points from the level of last January and was
the lowest in the past four years.
Yields cn new Aaa corporate bonds increased in October. As a
result, the spread between mortgage and bond yields narrowed again, to 130
basis points.
This was close to the spread which prevailed last summer.
Based on the Home Loan Bank Board's survey of large savings and
loan associations, interest rates on conventional loans for construction and
for the purchase of new and existing houses showed mixed movements in October.
As in other recent months, however, fees and commission charges as a
percentage of loan volume remained appreciably below year earlier levels.




Stock market credit. Customer credit in the stock market changed
little in October, increasing by only $9 million to $5.2 billion at the
month-end„ Although bank loans to other than brokers or dealers for
purchasing or carrying securities (except U. S. Government securities)
rose $32 million, the first month-to-month increase since April, customer
debit balances (excluding those secured by U. S. Government securities)
cfeclined $23 million to $3,9 billion at. the end of the month.
Money borrowed by member firms of the New York Stock Exchange
(except on U. S, Government securities) fell $93 million in October after
two sharp month-to-month increases, while customers' free credit balances
rose $35 million, the first increase since June. These and other data on
stock market credit in September and October are shown in the following table.

End of month
Oct.
1 Sept.
Customer credit
Excluding U. S, Government securities - total
Net debit balances
Bank loans to "others"
Net debit balances secured by U. S. Govt. securities
Bank loans to "others" for purchasing or carrying U. S.
Government securities
Broker and dealer credit
Money borrowed except on U, So Government securities
On customer collateral
Money borrowed on U. S. Government securities
Customers' net free credit balances
r/

Change

+9
-23
+32
-2

5 ,165
3 ,864
1 ,301
25

r/5,156
r/3 ,887
1 ,269
27

81

81

--

2.,596
,269
29
1,,126

2 ,689
2 ,381
49
1 ,091

-93
-112
-20
+35

2,

Revised.

Stock prices. Stock prices advanced sharply further again last
week in very active rrading. Prices, as measured by Standard and Poor's
composite index, increased over two per cent on balance, closing at 60.16
on November 16, At Friday's closing level, stock prices had advanced
one-eighth from r.heir late October low and were 15 per cent above this year's
low of late June but were still 17 per cent below last December's high.
Trading volume averaged 4.8 million shares a day, the highest weekly average
since late June.
New issue corporate bond yields -- new chart and revised data.
Exhibit G presents revised weekly data beginning with 1960 (the monthly
data shown in Exhibit F have not yet been revised) for yields on new issues
of corporate bonds, adjusted to an Aaa basis, and the chart on page 5
shows these data together with weekly averages for Moody's series on seasoned
Aaa-rated corporate bond yields. The new chart, and a table presenting
current data, will be included in subsequent Capital Market Developments
reports„ The new issue yield series is a current measure of interest
rate changes in the corporate bond market considerably more responsive to
changing market conditions than are yield series based on quotations on




-3 -

seasoned corporate bonds; however, as indicated in the following discussion,
the series is subject to certain erratic influences which require some
caution in current interpretation.
The new corporate issue yield series is an arithmetic average,
weighted by dollar amount, of reoffering yields (i.e. the yield to investors,
not the cost to the company issuing the bonds) on new bond issues publicly
offered each week and rated Aaa, Aa, or A by Moody's Investors Service
(some types of issues are excluded, however, because of distinctive
characteristics which make their yields unrepresentative). Previously,
yields on Aa- and A-rated bonds were adjusted to an Aaa basis before computing
the average by deducting from the actual reoffering yield the excess of the
composite weekly average yield on seasoned bonds of the appropriate quality
(Moody's series) over the composite average for seasoned Aaa-rated bonds„
This procedure, however, did not take into account the industrial composition
of new issue volume, since it adjusted the yield on bonds of all industries
by the composite seasoned bond yield spread; observable differences in yield
among bonds rated identically but issued by firms in different industries
were not taken into account.
While differences in yield spread among industry groups change
somewhat over time, they can be illustrated by the following October averages
for Moody's seasoned bond yield series.
Composite

Utility

Industrial

Yield Average (per cent)
Aaa
Aa
A

4.28
4.41
4.69

4.30
4.35
4.49

Basis Point Deviation
Aaa
Aa
A

0
13
41

2
7
21

4.09
4.26
4.35
from Aaa Composite
-19
7

The revised new issue series takes into account these industry yield
differentials by adjusting reoffering yield by the spread between the
composite Aaa average and the quality rating for the appropriate industry
group; for example, using the above spreads, the revised procedure would be
to reduce the actual yield on an A industrial issue by 7 basis points, whereas
the previous procedure would have reduced it by 41 basis points.
Although the revised new issue yield series appears to be a better
measure of level and changes in current yields than the series previously
utilized, the adjustment is by no means perfect. For example, the spread
in industry ratings, as before, may be different for new issue yields than
for seasoned bond yields, and this difference may change from time to time.
Also, as before, it has not appeared feasible to make allowances for the
effect on new issue yields of such factors as special call features,
differences in term to maturity (although all bonds included have a maturity




of over twenty years), unusually large or small offerings or differences in
investor" preference among bonds included in the same industry-rating
group,
It should also be noted that this series, in effect, reflects the
judgement of underwriters as to the yield required to place an issue with
investors and that this judgment is not always accurate. For example, an
issue may be included in the series at a reoffering yield which does not
in fact permit ready sale of the bonds to investors; in such a case the actual
yield, or yields, at which bonds are sold after a price reduction or termination of the syndicate agreement will be higher than that reflected in the
new issue yield series, On the other hand, an issue that is immediately
oversubscribed and bid to a premium in the secondary market would be included
st a yield higher than subsequent market behavior indicated necessary for
distribution.
Such considerations as these help to account for the widely
varying spread between new issue and seasoned bond yields shown in the
chart on page 5 . Other factors, however, seem even more important in
affecting this spread. Among these is the fact that bonds are included
in the seasoned bond yield averages only after they have been outstanding
for some time (i.e. become seasoned). Such bonds are not very actively
traded so that the quotations utilized may respond only with a lag to
changing capital market conditions. Moreover, quotations for seasoned bonds
(or sales of such bonds) are usually for relatively small lots of bonds;
quotations for large lots, such as are typical of new issue sales, may differ
considerably from these, Also, seasoned bonds carry coupon rates (as well as
other characteristics) specified at the time of initial offering; differences
as compared with current terms result in discounts or premiums from par,
which may affect investor preference because of the effect on the prospects
for call or on the tax status of income,
A final point is that new issue yields reflect underwriting
strategy. During periods of falling interest rates, underwriters are more
likely to price a new issue close to current market because the risk of loss
as a result cf a change in interest rates seems relatively small. Conversely,
in a period of rising yields the risk of loss as a result of setting too
high a price seems larger, and underwriters generally will make some allowance;
for this prospect. Such allowances are, of course, subject to varying degrees
of modifcation as a result of the bidding (or negotiation) of competing underwriters for new issues„
More detailed information concerning recent capital market
developments is presented in the attached exhibits.

Capital Market Section,
Division of Research and Statistics,
Board of Governors of the Federal Reserve System.




l l i u p s

ON

NEW AND

SEASONED

A d | u » t e d to Ai

I




CORPORATE BONDS

(EXHIBIT A. P o t t I.
[ l o n g - t e r m

b o n d

yields,

h i o h - o b a d i

1. 60VEMEIMI
long-lere

Exhibit A

Date

Corporate
Aaa 1/

Part II

U. 3. Govt,
long-term 2/

State and
local
government
Aa
» 3/

Spread between
U. S. Govt, and
Corporate
State and
Aaa
local Aaa

(per cent)
1957 - High
1958 - Low
1959-60 - High
1960-61 Low
1961 - High
1962 - High
Low

k.lh
3.55
U.a
4.21
4.1*6
4.43
4.25

Oct.
Oct.
Nov.
Nov.
Nov.

4.27
4.27
4.26
4.26
4.25

Note*

19
26
2
9
16 j>/

3.76 (10/18)

(9/27)
(5/2)
(1/29/60)
(3/17/61
(9/15)
(2/16)
(11/16)

3.07
4.42
3.70
4.07
4.12
3.85

/

3.88
3.89
3.87
3.86
3.87

For footnotes see Exhibit B.




(4/25)
(3/8/60)
(5/12/61)
(12/29)
(2/23)
(5/11)

.60

i

3.1*5 (8/29)
2.64(5/1)
3.65 (9/24/59)
2.99 (9/1/60)

.59
.19

2.88 (11/8)

"47
.29

1.08
.80

.39
.38
.39
.40
.38

.99
L.01
.99
.98
.98

2.89

2.88
2.88
2.88
2.89

.22

.'U6

.76

EXHIBIT * Pari |
LONG-TERM

BOND

'

f 1157

YIELDS, L O W E R - G R A D I

\[mJ

STATE A N D I Q C A l G O V E R N M E N T I . .

19S8

H59

I960

1911

11*1;

Exhibit B - Part II

Date

Corporate
Baa 1/

State and
local govt.
Baa 3/
(per cent)

1957 - High
1958 - Low
1959-60 - High
1960-61 Low
1961 - High
1962 - High
Low
Oct.
Oct.
Nov.
Nov.
. Nov.

19
26
2
9
16 £/

5-10
lw5L
5.36
U.98
5.13
5.11
4.96

(11/29)
(7/11)
(2/12/60)
(9/9/60)
(10/27)
(1/5)
(11/16)

4.98
4.98
4.99
4.97
4.96 ---

U.51
3.61*
U-U6
3.93
Ll6
4.04
3.52
3.59
3.58
3.53
3.53
3.53

(8/29)
(5/1)
(1/7/60)
(11/9/6I)
(3/23)
(1/11)
(5/17)

Spread between
Aaa and Baa
State and
Corporate
local govt.

1.27
.77

1.21
.93
1.08
.57
.93
.82
.56

.66
.81
.74
.63
.71
.71
.73
.71
.71

-

.70
.70
.65
.65
.64

y
Weekly average of daily figures. Average term of bonds included in 23-26 years.
2 / Weekly average of daily figures. The series includes bonds due o r callable in 10 years or more.
3 / Thursday figures. Only general obligation bonds are included; average term is 20 years.
N o t e . — H i g h s and lows are f o r individual series and m a y be on different dates for different
series. T o r spreads, high refers to widest, and loir to narrowest.




. t
EXHIBIT C. P a r t I
SHORT-

AND

INTERMEDIATE-

TERM INTEREST

RATES, G O V E R N M E N T

f . K. D I S C O U N T B A T E
3 - MONTH I I U S

I I I I I-LI.-LI-LI
I t LI LLLi 1.1 1 I I.I 1. I.I I LLILIL..1I I I I I I I I I
1961

Exhibit C - Part II
Bate

1957 - High
1958 - Low
1959-60 - H
1960-61 Low
1961 - High
1962 - High
Low
Oct.
Oct.
Nov.
Nov.
Nov.

19
26
2
9
16 2.1

Discount
rate
V

3-month
bills 2/

3.50
1.75
Loo
3.00
3.00
3.00
3.00

3.6it
.58
it. 59
2.11
2.66
2.97
2.65

3.00
3.00
3.00
3.00
3.00

2.74
2.74
2.74
2.82
2.82

(10/I8)
(5/29)
(3/8/60)
(10/28/60)
(12/29)
(7/13)
(6/8)

Yields
6-month
bills 2/
(per cent)

3.02
5.07
2.35
2.90
3.13
2.74
2.84
2.83
2.82
2.87
2.86

(12/26)
(3/8/60)
(4/28/61)
(12/29)
(7/20)
(6/8)

3-5 year
issues 2/

Spread between yields on 3month bills and yields on
6-mo. bills13-5 yr. issues

.86
.0I4

ll.Olt (10/18)
2.1U (6/6)
5.00(12/24/59)
3.15 (5/12/61)
3.66(8/11)
3.88 (2/2)
3.43 (11/9)

.26
.79
.12
.a
.24
.04

1.81
.38
1,51
1.19
.61

3.46
3.48
3.45
3.43
3.46

.10
.09
.08
.05
.04

.72
.74
.71
.61
.64

2/ Market yield; weekly averages computed from daily closing bid prices.
Series of 3 - 5 year issues
consists of selected notes and bonds.
N o t e . — H i g h s and lows are f o r individual series and m a y be on different dates for different series.
T o r spreads, high refers to widest, and low to narrowest.




S H O R T - AND I N T E R M E D I A T E - T E R M INTEREST RATES,
B A N K S A N D OTHER PRIVATE B O R R O W E R S

S T O C K EX C H A N G
CALL LOANS
r
INANCE COMPANY PAPEK
Directly Rio

FEDERAL FUNDS
EifecIive Ro

LLLJ T i l l

U

I I I I I I I I I J-LLl LJJ-l-i-LI_LLiJUJ_LLi_LLJ_LlJ. 1. L I _ L L L U _ L L U
I960
Exhibit D

Date

Stock E x c h a n g e
call loan 1 /

Prime
rate 1 /

1961

1142

•f

- Part I I
Finance company
paper 2/ .

Federal
funds 3 /

Spread b e t w e e n
3 - m o . b i l l s and
f i n a n c e Co. o a n e r

(per c e n t )
1957 - H i g h
1958 - Low
1959-60 - High
1960-SL LOW
1961 - High
1962 - High
Low
Oct.
Oct.
Nov.
Nov.
Nov.

19
26
2
9
16 j>/

U.50
3.50
5.50
1.50
u.50
4.50
4.50

U.50
3.50
5.00
U.5o
U.5o
4.50
4.50

3.88
1.13
5.13
2.50
3.00
3.25
2.88

4.50
4.50
4.50
4.50
4.50

4.50
4.50
4.50
4.50
4.50

3.00
,3.00
2.95
3.03
3.11

(11/15)
(8/8)
(1/22/60)
(8/5/61)
(12/29)
(7/20)
(6/1)

3.50 ( 1 1 / 8 )
.13 ( 5 / 2 9 )
U.00 ( 5 / 1 3 / 6 0 )
.U3 (1/27/61)
2.88 ( 1 2 / 2 9 )
3 . 0 0 (11/16)
1 . 3 0 (1/26)
2.95
2.88
2.93
3.00
3.00

.63
-.35
1.02
.11
.56
.45
.19
.26
.26
.21
.21
.29

Weekly rate shown is that in effect at end of period. Stock Exchange call loan rate is going rate
on call loans secured by customers* stock exchange collateral at New York City banks. Prime rate
is that charged by large banks on short-term loans to business borrowers of the highest credit
standing.
2/ Average of daily rates published by finance companies for directly placed paper for varying maturities
in the 90-179 day range.
3/ Weekly average of daily effective rate, which is the rate for the heaviest volume of purchase and
sale transactions as reported to the Federal Reserve Bank of New York.
Note.—Highs and lows are for individual series and may be on different dates for different series.
For spreads, high refers to widest, and low to narrowest.
1/




EXHIBIT E, Port I
STOCK

MARKET
*1941-43 Avrog» = lo|
Mil

Million, of Doll

^ • W ^ S T O C I H A I M T (*EB

^

CHANGE IN S C « l t S
^xrl joj
lll'lont of Sh

i m
Exhibit E

Part

Stock price

Date

index 1/

stock
yields
(per

II

Trading

Common

Stock market

volume y
2/

cent) of

Total

shares)

- High
Low

1962

- High
Low

September

72.01* (12/8/61)

credit

Bank

debit bal-

loans

ances h /
(In m i l l i o n s

1960-61

customer

Customers'

(millions

to

"others" 5/

of d o l l a r s )

2.82

5.8

5,602 (12/61)14,259 (12/61) 1,377 (e/30/6i)

2.2

(10/21/60)

3.62

k,lll2 ( 5 / 6 0 ) 3,OOl4 ( 7 / 6 0 )

1,121 (5/25/60)

70.94

(3/16)

2.93

10.1

5,491

(4)

4,111

(1)

1,418

(5/9)

52.68

(6/22)

3.96

2.4

4,876

(7)

3,562

(7)

1,269

(9/26)

3.3

53.32

58.00

r/5,156

r/3,887

October

56.17

3.71

3.4

5,165

3,864

Nov.

2

57.75

3.61

4.0

n.a.

1,301

Nov.

9

58.78

3.55

4.4

n.a.

1,320

Nov.

1 6 j>/

60.16

3.47

4.8

n.a.

3.60

r/1,269
1,301

n . a . — N o t available*
j/ P r e l i m i n a r y . . .
j/ Standard and Poor's composite index of 5 0 0 common stocks, weekly closing prices, 1941-43"10.
Monthly data are averages of daily figures rather than of Friday's only. Highs and lows are for
Friday's data only*
2/ Standard and Poor's composite stock yield based on Wednesday data converted to weekly closing
prices by Federal Reserve. Yields shown are f o r dates on which price index reached its high
3/
4/
5/

Averages of daily trading volume o n the New York Stock Exchange.
End of m o n t h figures for member firms of the N e w Y o r k Stock Exchange which carry margin accountsj
excludes balances secured by U . S. Government obligations.
Wednesday figures for weekly reporting m e m b e r banks. Excludes loans for purchasing o r carrying
V . S . Government securities. Prior t o July 1, 1959, such loans are excluded only at banks in
N e w York and Chicago. Weekly reporting banks account for about 70 per cent of loans to others.
F o r further detail see Bulletin.




EXHIBIT F, Port jl

MORTGAGE

AND

B O N D YIELDS -

HOME M O R T G A G E S . FHA

' 1951

1959

Exhibit F

- Part

Aaa

FHA
mortgages

1953-58

- High
Low

1959-61
1962
1962

i/

1960
II

corporate

Spread between new

New

3/

,
corporate bonds and
M | S e a s o n e d U / FHA. m o r t g a g e s ( S e a s o n e d bondiai

5.63

(11/57)

4.81

(6/57)

4.12

(9/57)

1.96

.90

4.56

(2/55)

2.74

(3/54)

2.85

(4/54)

.54

-.12

(1/60)

j

bonds

2/

- High

6.24

1.76

.77

5.57

(3/59)

4.26

(10/61)

4.12

(1/59)

.65

-.16

High

5.72

(1/62)

4.50

5.29

(2/62)

(9/59)

4.42

4.61

(2/62)

(1/60)

1.53-

.08

July

5.60

4.34

1.27

-.01

August

5.58

4.30

4.35

1.28

-.05

September

5.56

4.13

4.32

1.43

-.19

October

5.54

r/4.23

4.28

1.31

-.04

4.33

Neither mortgage n o r bond yields take into account servicing costs which are much higher for
^
mortgages than bonds. Generally, bonds pay interest semi-annually; mortgages, monthly. Mortgage A
yields, if computed as equivalent t o a semiannual interest investment, irouM be slightly higher , ^
than g i v e n in the table.
t
Based on FHA field—office opinions about average bid prices in the private secondary market f o r J/f,
new-home mortgages f o r immediate delivery. Since late 1955, data relate only t o 25-year mortgages
•with donnpaymenta of 10 p e r cent or more, weighted by probable volume of transactions. Yields
computed by iRB, assuming 25-year mortgages are paid off in 12 years. Dashed lines indicate
^
periods of adjustment t o changes in the contractual interest rate.
f
See note for Exhibit G .
Moody's Investors Service. Monthly averages of daily data. See Exhibit B.




Exhibit. G

H.14

Yields on New Corporate Bond Issues Adjusted to an Aaa Basis
Number Am 1 r of issues Average
included (mil.
yield
of
(per cent'
issues of dollars)
Weekly averages;
1961 - Jan. 6
13
20
27
Feb. 3
10
17
24
'
Mar. 3
J

---

1
1
1
1
2
3

4.44
4.39
4.28
4.24
4.29
4,29

10

17
24
4
31
f
Apr. 7
3
3
#
14
21
2
28
4
3
May 5
k
1
%
12
6
M
19
5
26
W
June 2
3
) •
9
4 '
16
6
23
3
30
2
-=
!
July 7
14
1
21
1
28
2
Aug. 4
2
11
1
18
1
25
Sept. 1
8
15
1
22
29
1
Oct. 6
2
13
20
2
27
3
Nov. 3
3
i
10
17
4
24
1
Dec. 1
1
2
8
15
1
22
29
-
3

——

10.0
7.0
12.0
6.8
48.0
43.0

108.0

4.29

90.0
82.0
312.0
79.0
165.0
30.0
91.0
165.0
60.0
307.0
137.0
130.0
67.5

4.43
4.47
4.53
4.62
4.56
4.49
4.56
4.62
4.78
4.71
4.78
4.67
4.68,

z

--

8.0
200.0
65.0
55.0
20.0
40.0

4.70
4.77
4.55
4.67
4.74
4.57

18.0

4.53

60.8
45.0

4.38
4.29

60.0
95.0
45.0

4.28
4.38
4.32

94.0
60.0
30.0
75.0
50.0

4.34
4.40
4.44
4.42
4.62

...



1962-Jan. 5
12
19
'
26
Feb. 2
9
16
23
Mar. 2
9
16
23
30
Apr. 6
13
20
27
May 4
11
18
25
June 1
8
15
22
29
July 6
13
20
27
Aug. 3
10
17
24
31
Sept. 7
14
21
28
Oct, 5
12
19
26
Nov. 2
9
16
23
30
Dec. 7
14
21
28

Number Am't of issues Average
yield
included (mil.
of
(per cent)
issues of dollars)
--

1

60.0

4>8

3

70.0

4.55

2
1
1
1
1
2
2
2
2
2

1.9.5
300.0
50.0
25.0
30.0
65.0
60.0
85.0
98.0
26.0
100.0

4 46
4.50
4.47
4.40
4.32
4.27
4.42
4.37
4.41
4.15
4.15

2
2
2
2
1
3
4
3
1

115.0
28.0
41.0
39.0
17.0
115.0
67.0
145.0
24.0

4.28
4.18
4.08
4.15
4„18
4c 30
4.22
4.18
4.35

• --

—

——

50.0
46.0
20.0
107.3
115.0
70.0
52.0
60.0
12.0
50.0

4.44
4.29
4,33
4.33
4.45
4.27
4,29
4 28
4.23
4.22

1
1

4.9
75.0

4.16
4,22

2
3
2

275.0
85.0
37.0

4.29
4.14
4.13

1
3
1
4
2
3
2
1
1
1
--

Exhibit H

H.14

Long-term Corporate and State and Local Government
Security Offerings and Placements
(In millions of dollars)
New capital
State and local 2/
| I960
I 1961

Corporate 1/
1
1961
i

1960

592
859
807

580
^667
562

570
715
860

£/ 876
£/l,133
2/629

713
689
764

700
611
568

1,113
760
1,132

2,118
1,259
1,318

761
577
1,044

£/B7 3
£/9?3
£/'.'£••

723
641
1,034

719
545
991

582
769
5?9

1,028
762
647

736
967
726

e/600
e/575
e/ 400

485
604
734

492
606
683

October
November
December

e/650
e/75 3

1,090
948
1,000

890
956
852

• e/600
: ±/5 v

678
789
606

348
501
491

1st
2nd
3rd
4th

2,258
3,005

1,809
4,695
2,437
3,038

2,145
2,382
2,428
2,698

£/ 2,639
£/2,5::=
e/1,575

2,166
2,397
1,823
2,073

1,880
2,256
1,780
1,340

6,504
8,941
11,979

4,527
6,955
9,653

£/5,'^
e/6,'83

4,563
6,386
8,460

4,136
5,916
7,257

1962
January
February
March
April
May
June
July
August
September

quarter
quarter
quarter
quarter

1st half
Three quarters
Year

5,263
7 ,1' 3

1962

1

Excluding finance companies 3/
1st
2nd
3rd
4th

quarter
quarter
quarter
quarter

2,199
2,919

Year

1,554
4,552
2,337
2,807

1,716
2,165
2,018
2,347

11,253

8,246

e 7 E s t i m a t e d by Federal Reserve.
£/ Preliminary.
JL/ Securities and Exchange Commission estimates of net proceeds.
21 Investment Bankers Association of America estimates of principal amounts:
3/ Total new capital issues excluding offerings of sales and consumer finance
companies.




1

H. 14

Exhibit I
New Corporate Security Issues, Type of Issue and Issuer
(In millions of dollars)
Gross proceeds for new
capital and refunding 1/
Common

Quarter

Total Publicly Privately
offered offered

month

New proceeds for
new capital 1 / 2 /
foreign

pfd.

Mfg.

Public Communiutility cations

Other
issuers

included

1960 - I
II
III
IV

2 ,265
2 ,537
2 ,520
2 ,832

934
1 ,074
1 ,336
1 ,462

795
770
754
955

536
692
429
416

69
27
38
17

298
511
562
625

598
808
652
696

189
149
317
381

1 ,059
913
896
997

1961 - I
II
III
IV

1 ,992
5.,352
2.,566
3.,236

662
2 ,303
772
967

880
1 ,275
1 ,139
1 ,424

449
1,774
654
845

76
155
69
62

515
1,466
595
836

381
1,081
595
836

81
1,095
104
147

832
1 ,052
803
1 ,263

1962 - I
II
III
IV

2,,378
,250
3j
2,,184

1 s,155
1 .,389

716
1 ;,222
• 1.
,024

507
639
307

68
257
56

655
996
601

430
983
375

456
231
275

717
794
659

601
695
696
2 ,231
1 ,342
1 ,779
July 1 ,075
Aug.
813
Sept.
678
Oct, 1 ,155
Nov.
987
Dec. 1:,094

178
273
211
713
666
924
424
225
123
336
414
217

294
255
331
348
355
572
392
411
336
509
348
567

129
167
154
1,170
320
283
259
177
218
310
225
310

54
19
3
71
35
49
52
7
10
25
12
25

169
99
248
574
447
446
428
255
252
271
215
306

137
160
84
254
439
389
369
215
111
306
362
168

21
41
19
994
85
16
16
13
75
25
80
42

253
368
211
297
289
467
315
279
209
487
291
485

232
232
253
227
420
575
366
363
295
350

143
155
209
336
134
169
67
82
161
100

205
131 •
318
384
270
342
217
218
166
210

89
73
148
362
193 . , 21
88
377
196
64
410
79
118
88
110
120
148
67
260
140

225
218
275
264
229
301
159
301
199
240

-

J

e

Feb.
Mar.
Apr.
May

- Jan.
Feb.
Mar.
Apr.
May

647
884
847
1,,217
801
1 , 232
630
July
922
Aug.
632
Sept.
Oct.e/ 980
Nov.
Dec.

853

273
497
386
654
247
488
200
477
176
530

-

3
12
54
10
147
100
13
43
n.a.

j)/ Preliminary.
e/ Estimated by Federal Reserve.
1/ Gross proceeds exceed
net proceeds by the cost of flotation.
_2/ For total see Exhibit H; other issuers
are extractive, railroad and other transportation, real estate and finance and
commercial and other. Source.--Securities and Exchange Commission.




Other Security Offerings
(In millions of dollars)
Gross long-term 1/
Federal agency 3/
Foreign government 2/
j
1962
1 1961
1960
1962
|
1961
1
January
February
April
May
July
August
September
October
November
December

43
34
--

-

Year
Jan.-Oct.

6
29
20
2
66
29
5
2

142
10
35
10
86
50
25
8
<1
e/150

e/54-

2
175
70
34
72
40
25
1
36
34
2
41

236

533

202

489

246
156
461

150
175
e/--

252
100
149
278
250
193

182
150
150
148
354

199

--

160
149
181

1 ,448

1,672

1,222

1,343

225

e/L ,188

,
1960

Net short-term 4/
Federal agency 3/
State and local government 5/
January
"ebruary
4pril
May
June
July
September
October
November
December

18
466
-186
127
-84
-118
78
339
2/-407

Tear
Jan.-Oct.

n.a.

p/
1/

160
195
-8
-103
-42
-155
109
518
-86
-6
54
-116

58
140
-80
70
-146
-157
48
415
-175
-16
50
-189

520

18

580

157

.

247
-156
226
-364
82
284
261
227
-157
2/557

VI >207

•;

-144
-162
-174
-79
-87
207
22
193
108
98
56
-114

-196
-202
-59
-277
170
320
95
23
-201
-23
-33
-250

-76

-633

-18

-350

Preliminary.
e/ Estimated by Federal Reserve.
n.a.--Not available.
These data differ from those in Exhibit H in that refunding issues, as well as
new capital issues, are included. Long-term securities are defined as those
maturing.in more than one year.
2/ Includes securities offered in the United States by foreign governments and their
political subdivisions and international organizations. Source: Securities and
Exchange Commission.
3/ Issues not guaranteed by the U. S. Government. Source: Long-term, Securities
and Exchange Commission; short-term, Treasury Department and Federal Reserve.
4/ These data differ from those in Exhibit H and above in that they represent new
offerings less retirements, whether from the proceeds of refunding issues or from
other funds, Data include only issues with original maturity of one year or less.
5/ Principally tax and bond anticipation notes, warrants or certificates and Public
Digitized Housing
for FRASER
Authority notes. In some instances PHA notes included may have a s o m ^ - $
what longer maturity than one year. Source: Bond Buyer and Federal Reserve.
http://fraser.stlouisfed.org/

Federal Reserve Bank of St. Louis

*

-Y
*
l

\U
H. 14

Exhibit K
Large Long-term Public Security Issues for New Capital
(Other than U. S. Treasury) 1/
Proceeds of Large Issues Offered
(In millions of dollars)
Corporate
Month

Total

1961 - October
November
December
1962
January
February
March
April
May

354
391
255
195
425
366
648
200
472
165
286
191
434

July
August
September
October

(other than
convertibles)
205
320
125
170
425
330
430
170
387
135
226
100
398

"

Convertible

Stocks

State
and
local
government

81
45
130
25

67
26

21
167
30
85
30

15
51

60
91
36

Other
2/
40
250

326
480
307
561
662
259
423
373
226
361
272
153
320

145
64
30
55
88
30
20
194
25

Large Individual Issues Offered November 1 through 16

Issuer

Type 3/

Coupon
Amount
(millions
Offering
Maturity
net inter- yield
of
dollars)
est cost

Rating

CORPORATE
Columbia Gas System
Georgia Power Co.
Household Finance Corp.
Louisville and Nashville
RR. Co.

Deb.
1st mtg. bds.
Deb.
Coll,tr.bds.

30.0
23.0
60.0
9.7—/

1987
1992
1987

4-3/8
4-3/8
4-3/8

4.35
4.30
4.40

1987

4-7/8

4.88

.

A
A

Baa

STATE AND LOCAL GOVERNMENT
Cincinnati, Ohio
East Bay Mun. Util. Dist.,
Cal „
Houston, Texas
Lincoln Sch. Dist., Neb,
State of Connecticut
Philadelphia, Pa.

G .0.
G,.0.
Rev,,-ut.
G..0,
G..0.
G.,0.

OTHER
None,




12.3

1964-98

2 .90

1 .55-3 .15

33.0
14.0
12.0
48.0
21.72/

1963-92
1963-96
1964-82
1967-83
1964-93

2..92
3..30
2..78
2..56
2.,97

1,.50-3,
1,.50-3,,40^/
1, 60-2,.85
1,.90-2,.90
1..55-3,.258/

Aa
A
Aa
A

H.14
Footnote Page

*--Rights offering.
1/ Includes corporate and other security offerings of $15 million and over;
State and local government offerings of $10 million and over.
2/ Includes foreign government and International Bank for Reconstruction and
Development issues and non-guaranteed issues'by Federal agencies.
3/ In the case of State and local government securities, G.O. denotes general
obligations; Rev.-Ut., revenue obligations secured only by income from
public utilities; Rev.-Q.Ut., revenue bonds secured only by revenue from
quasi-utilities; Rev.-S.T., revenue bonds secured by revenue from specific
taxes only; Rev.-Rent., revenue bonds secured solely by lease payments.
4/ An additional $15-3 million in bonds was sold to refund outstanding securities.
5f 2 per cent bonds maturing 1990-92 reoffered to yield 3.55 per cent.
6/ 2 per cent bonds maturing 1996 reoffered to yield 3.70 per cent.
Tj An additional $5.0 million was sold to refund outstanding securities.
8I 0.1 per cent bonds maturing 1990-93 not reoffered.




'4
Exhibit L

H.14

Forthcoming Large Long-term Public Security Offerings for New Capital
(Other than U. S. Treasury) 1/
Expected Proceeds from Forthcoming Large Issues

Date of
computation

K:

1
v:

During month following
date shown
State and
Other 2/
Corporate
local govt.

1961 - Oct. 31
Nov. 30
Dec. 29
1962 - Jan. 31
Feb. 28
Mar. 30
Apr. 30
May 31
June 29
July 31
Aug. 31
Sept. 28
Oct. 31

346
356
161
480
222
628
185
587
120
302
170
363 :
203

597
295
223
465
153
453
333
184
202
273
61
187
96

64

95
55

175
--

Subsequent to
date shown
Other 2/

Corporate
z

411
421
591
525
341
693
598
692
458
477
312
546
328

693
498
415
567
239
539
452
337
377
427
215
387
243

64

95
55
25
175
—

Forthcoming Large Offerings, as of November 16

Issuer

Type

Amount
(millions
of dollars)

Approximate date
of offering

CORPORATE
Pacific Gas & Electric Co.
Metropolitan Edison Co.
Consolidated Edison Co.
Tennessee Gas Trans. Co.
Commerce Oil Refining Corp.
Columbia Bancorporation

1st & ref. mtg. bds.
1st intg. bds.
1st & ref. mtg. bds.
1st mtg. bds.
Deb., bds. & com,
Conv. sub. deb.

65.0
15.0
60.0
50.0
45.0
30.0

Nov. 28
Dec. 4
Dec. 6
Indefinite
Indefinite
Indefinite

10.0
15.0
25.0
100.1
11.9
11.3
35.0
12.9
46.0
40.0

Nov. 27
Nov. 27
Nov. 28
Dec. 12
Dec. 13
Dec. 19
Indefinite
Indefinite
Indefinite
Indefinite

STATE AND LOCAL GOVERNMENT
Oklahoma City Mun„ Impr. Auth.
Texas Water Dev. Bd.
*State of Kentucky
Public Housing Auth.
Tampa, Florida
Richmond, Va.
Pittsburgh, Pa.
Jefferson County, Colorado
Dade County, Florida
Jacksonville Expressway Auth., Fla.




Rev.
G.O.
G.O.
G.O.
G.O.
G.O.
G c 0.
G.O.
Rev.-Ut.

L-2

H.14

Forthcoming Large Offerings, as of November'

Issuer

Type

Amount
(millions
of dollars)

(Cont'd)
Approximate date
of offering

OTHER
None.
^--Included in table for first time.
V
Includes corporate and other issues of $15 million and over; State and local
government issues of $10 million and over.
2/ Includes foreign government and International Bank for Reconstruction and
Development issues and non-guaranteed issues of Federal agencies.
Note.--Deletions for reasons other than sale of issue: None.