Research Quarterly, Fourth Quarter 2017

Long-term securities issuance totaled $1.81 trillion in 4Q’17, a 1.6 percent increase from $1.78 trillion in 3Q’17 and a 3.6 percent increase year-over-year (y-o-y) from $1.75 trillion. Issuance increased quarter-over-quarter (q-o-q) across all asset classes except mortgage-related, corporate, and agency ; y-o-y, most asset classes increased in issuance except mortgage-related and asset-backed. For the full year 2017, long-term issuance totaled $7.54 trillion, a slight decrease of 1.1 percent from $7.62 trillion in 2016. The annual decrease was driven primarily by a decrease in mortgage-related and agency issuance.

2017 Q4: RQ

Long-term public municipal issuance volume including private placements for 4Q’17 was $146.7 billion, up 60.3 percent from $91.5 billion in 3Q’17 and up 39.8 percent from $104.9 billion in 4Q’16. Full year issuance was $448.1 billion, an increase of 0.5 percent from $445.8 billion in 2016.

The U.S. Treasury issued $535.5 billion in coupons, Floating Rate Notes and Treasury Inflation Protected Securities in 4Q’17, up 15.4 percent from $463.9 billion in the prior quarter and 18.6 percent above $451.6 billion issued in 4Q’16. In full year 2017, Treasury issued $2.22 trillion in Treasury coupons, FRNs and TIPS, up 2.5 percent from $2.17 trillion in 2016.

Issuance of mortgage-related securities, including agency and non-agency passthroughs and collateralized mortgage obligations, totaled $483.2 billion in the fourth quarter, a 1.8 percent decrease from 3Q’17 ($492.3 billion) but a 17.9 percent decrease y-o-y ($588.4 billion). For full year 2017, $1.88 trillion of mortgage-related securities were issued, a decrease of 7.6 percent from $2.04 trillion in 2016.

Corporate bond issuance totaled $319.2 billion in 4Q’17, down 24 percent from $420.1 billion issued in 3Q’17 but up 21.0 percent from 4Q’16’s issuance of $263.9 billion. Of 4Q’17 corporate bond issuance, investment grade issuance was $250.4 billion (78.4 percent of total) while high yield issuance was $68.8 billion (21.6 percent of total). For full year 2017, corporate bond issuance totaled $1.63 trillion, up 6.9 percent from $1.53 trillion in 2016.

Long-term federal agency debt issuance was $187.6 billion in the fourth quarter, which remain unchanged from $187.6 billion in 3Q’17 but a 4.9 percent increase from $178.9 billion issued in 4Q’16. For the full year, long-term agency issuance was $710.0 billion, a decrease of 22.4 percent from $915.5 billion in 2016.

Asset-backed securities issuance totaled $84.0 billion in the fourth quarter, an increase of 10.8 percent q-o-q ($75.8 billion) but a 26.2 percent decrease y-o-y ($113.9 billion) in 4Q’16. For the full year, issuance totaled $425.1 billion, an increase of 31.8 percent from the prior year.

Equity underwriting increased by 5.2 percent to $55.0 billion in the fourth quarter from $52.3 billion in 3Q’17 and up 17.5 percent from $46.8 billion issued in 4Q’16. Of the total, “true” initial public accounted for $11.8 billion, up 152.6 percent from $4.7 billion in 3Q’17 and up 168.1 percent from $4.4 billion in 4Q’16. In full year 2017, $36.3 billion was raised through 169 IPOs, up 103.4 percent from $17.8 billion on 107 deals in 2016.

 

About the Report

A quarterly report containing brief commentary and statistics on the U.S. capital markets, including but not limited to: municipal debt, U.S. Treasury and agency debt, short-term funding and money market debt, mortgage-related, asset-backed and CDO debt; corporate bonds, equity and other, derivatives, and the primary loan market.

Credits

SIFMA Research

  • Managing Director, Director of Research: Kyle Brandon
  • VP: Sharon Sung
  • AVP: Justyna Podziemska
  • Intern: Daniel Konstantinovsky
  • Intern: Emily Losi