U.S. CAPITAL MARKETS DECK - Securities Industry and ... · PDF file4. 2006. 2015. 0. 2. 4. 6....
Transcript of U.S. CAPITAL MARKETS DECK - Securities Industry and ... · PDF file4. 2006. 2015. 0. 2. 4. 6....
U.S. CAPITAL MARKETS DECK
SIFMA RESEARCH
OCTOBER 2016
IntroductionAmerica has the largest and deepest capital markets in the world according to the Federal Reserve, the capital markets provide almost 80% of debt financing for businesses in the U.S. The securities industry facilitates access to those markets, creating investor opportunity, capital formation, job creation and economic growth.
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In 2015, market capitalization the total value of all publicly traded securities of the U.S. stock market was $26.5 trillion.
166 companies conducted initial public offerings in 2015 in the U.S. raising over $32.5 billion in new capital new values for the companies, their employees and their investors.
The $8.2 trillion corporate bond market is the largest in the world: approximately 1,306 U.S. companies issued $1.5 trillion in corporate bonds to fund their operations and growth in 2015.
Municipal issuers raised over $377.6 billion in 2015 to finance important community infrastructure projects including schools, airports, roads and bridges.
U.S. Economy GDP
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U.S. GDP was $16.4 trillion as of end-2015, up 12.2% from $14.6 trillion in 2006.
2006 20150
2
4
6
8
10
12
14
16
18
Source: Bureau of Economic Analysis
GDP2006 and 2015
$ Trillions
19.3% 16.5%
67% 68%
-5.6% -3.1%
19.1% 18.2%
2006 2015-20%
0%
20%
40%
60%
80%
100%
Source: Bureau of Economic Analysis
GDP By Category2006 and 2015
GovernmentConsumption &Investment
Net Exports ofGoods andServices (Exports- Imports)
PersonalConsumptionExpenditures
Gross PrivateDomesticInvestment(Corporate)
U.S. Economy GDP Detail
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2006 20150
2
4
6
8
10
12
Source: Bureau of Economic Analysis
GDP By Category - Personal Consumption2006 and 2015
Durable Goods
NondurableGoods
Services
$ Trillions
2006 20150
0.5
1
1.5
2
2.5
3
Source: Bureau of Economic Analysis
GDP By Category - Gross Private Domestic Investment (Corporate)
Change in PrivateInventories
Residential FixedInvestment
Nonresidential FixedInvestment
$ Trillions
U.S. Economy GDP in Perspective
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In 2006, U.S. GDP was more than three times as large as Japans GDP, nearly six times as large as Chinas GDP, and 90.6% of the EU28 GDP.
As of 2015, U.S. GDP was more than four times that of Japan, nearly twice as large as Chinas GDP and 10.6% greater than EU28 GDP.
Note: European Union includes the 28 EU-member states; China excludes Hong Kong
U.S. Economy - Employment
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U.S. nonfarm employment stood at 148 million as of end-2015, up 4% from 142 million in 2006.
Transportation and
warehousing3%
Finance and insurance
4%
Administrative and waste
management services
6%
Agriculture, Mining, Utilities,
Construction6%
Manufacturing9%
Health care and social assistance
13%
Trade15%
Government16%
Other28%
U.S. Employment, 2015Total: 147.6 million
Source: Bureau of Economic Analysis
0
20
40
60
80
100
120
140
160
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015Source: Thomson Reuters
U.S. Employment2006 - 2015
Government
Farm
Nonfarm ex. GovernmentMillions
U.S. Corporate Financing in Perspective
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Note: Euro Area includes the 19 EU-member states that have adopted the Euro currency
U.S. companies rely on the capital markets for a greater portion of total funding than do companies
in the Euro Area, Japan or China, which rely more on bank funding.
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
U.S. Euro Area Japan China (2012)Sources: OECD, ECB, Bank of Japan, National Bureau of Statistics of China
Financing of non-financial corporations2015
Other Financing
Other Equity
Quoted Shares
Bonds
Loans
U.S. Corporate Debt Financing in Perspective
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Note: EU includes the 28 EU-member states
U.S. companies rely more on the debt capital markets for credit financing than do those in the
European Union or Japan, which rely more on bank loans for funding.
Equity Markets as % of GDP
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Note: Includes only non-financial corporate equities; Euro Area includes the 19 EU-member states that have adopted the Euro currency; China excludes Hong Kong
The U.S. has a larger equity market relative to the size of GDP (152%), followed by Japan (107%),
the Euro Area (62%) and China (58%).
0%
20%
40%
60%
80%
100%
120%
140%
160%
U.S. Euro Area Japan ChinaSources: OECD, Bank of Japan, ECB, World Bank, World Federation of Exchanges
Size of Listed Equity Market as % of GDP2015
Bond & Equity Markets as % of GDP
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Note: Includes only non-financial corporate equities; Euro Area includes the 19 EU-member states that have adopted the Euro currency; China excludes Hong Kong
The U.S. has the largest bond and equity market relative to the size of GDP (358%), followed by
Japan (336%), the Euro Area (180%) and China (100%).
0%
50%
100%
150%
200%
250%
300%
350%
400%
450%
U.S. Euro Area Japan ChinaSources: BIS, World Bank, World Federation of Exchanges
Size of Listed Bond & Equity Market as % of GDP2015
U.S. Capital Markets
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Note: Issuance includes long-term corporate, agency and non-agency MBS and CMOs, agency debentures, Treasury, and municipal securities, and primary and secondary equity issuance. Outstanding includes both short- and long-term debt securities and equity market capitalization.
Bond Market96%
Equity Market4%
U.S. Capital Markets Issuance - Equity vs Bonds, 2015
Total: $6.8 trillion
Source: Bloomberg, Dealogic, Thomson Reuters, US Agencies, US Treasury, SIFMA
Bond Market58%
Equity Market42%
U.S. Capital Markets Outstanding - Equity vs Bonds, 2015
Total: $62.7 trillion
Source: NYSE, NASDAQ, Federal Reserve, Bloomberg, U.S. Agencies, U.S. Treasury, SIFMA
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U.S. Bond Markets: IssuanceBetween 2006 and 2015:
Treasury issuance increased to represent from 13.3% to 11.6% of total U.S. bond issuance
Corporate issuances decreased from 17.9% to 17.5%
Mortgage-related issuances decreased from 46.1% to 38.4%
0
1
2
3
4
5
6
7
8
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015Source: Thomson Reuters, Bloomberg, Dealogic, US Treasury, US Agencies, SIFMA
U.S Long-Term Bond Issuance2006 - 2015
Corporate Asset-Backed Mortgage-related Federal Agency Muni/State Treasury$ Trillions
U.S. Bond Markets: Outstanding
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The total value of outstanding bonds in the U.S. was $36.3 trillion at the end of 2015, 39.7% larger
than at end-2006.
While all sectors increased in dollar volume outstanding between 2006 and 2015, Treasuries and
corporates increased relatively more than the other products, with Treasuries doubling in volume
and corporates growing 68.7% between 2006 and 2015.
Treasury Bond Markets: A Closer Look
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The U.S. Treasury issues different maturities of debt: Short Term or Bills (up to one year) and Long-Term or Notes (one year to 10 years) and Bonds (over 10 years).
In 2015, the U.S. Treasury issued $2.1 trillion in new long-term securities, almost three times the $788.5 billion issued in 2006.
The U.S. Treasury bond market outstanding was $13.2 trillion as of end-2015, up three-fold from end-2006.
Bills70%
Notes27%
Bonds3%
U.S. Treasury Bond Issuance By Tenor, 2015Total: $7.0 trillion
Source: U.S. Treasury
0
500
1,000
1,500
2,000
2,500
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015Source: U.S. Treasury
U.S. Long-Term Treasury Bond Issuance2006 - 2015
$ Billions
Chart1
U.S. Treasury Bond Issuance By Tenor, 2015
Total: $7.0 trillion
BillsNotesBonds4894.09653330000041930.6552580999999191.7658246
Charts
1GDP by Category
GDP
2006 and 2015
US GDP2006201514613.816397.2
Source: Bureau of Economic Analysis
Financing of non-financial corporations' debt
2015
Stock of Bank LendingEUUSJapan0.7507504210050080.211060593062823460.78489040824119938Debt Securities OutstandingEUUSJapan0.249249578994991920.788939406937176570.21510959175880065
Sources: Bank of Japan, ECB, Federal Reserve
Size of Listed Bond & Equity Market as % of GDP
2015
Market Cap as a % of GDPU.S.Euro AreaJapanChina3.49875420890459351.52436051820803623.89846030547770541.1314355492048103
Sources: BIS, World Bank, World Federation of Exchanges
Size of Listed Equity Market as % of GDP
2015
Market Cap as a % of GDPU.S.Euro AreaJapanChina1.47741049470914240.6125205594938291.18171485911419370.43622107193089843
Sources: OECD, Bank of Japan, ECB, World Bank, World Federation of Exchanges
U.S Long-Term Bond Issuance
2006 - 2015
Treasury2006200720082009201020112012201320142015788.54580999999996752.204569000000111029.44537582197.21142410000042319.83256780000062103.27637039999992304.56169129999992140.00