Municipal Volumes Sink as Interest Rates Rise
NORWALK, Conn., Jan. 20, 2023 (GLOBE NEWSWIRE) — CUSIP Global Services (CGS) today announced the release of its CUSIP Issuance Trends Report for December 2022. The report, which tracks the issuance of new security identifiers as an early indicator of debt and capital markets activity over the next quarter, found monthly decreases in request volume for new corporate and municipal identifiers, while year-over-year volumes for U.S. corporate securities increased.
North American corporate requests totaled 5,279 in December, which is down 6.5% on a monthly basis. On a year-over-year basis, North American corporate requests closed out December up 7.3% over 2021 totals. The annual increase in corporate CUSIP request volume was driven largely by a significant surge in short- and long-term certificate of deposit (CD) volume. On a year-over-year basis, CUSIP request volume for short-term CDs is up 273.9% and request volume for long-term CDs with maturities of one year or more is up 65.8%. U.S. corporate equity volumes are down 27.5% and U.S. corporate debt volumes are down 5.4% year-over-year.
Municipal request volume decreased on both a monthly and annualized basis. The aggregate total of identifier requests for new municipal securities – including municipal bonds, long-term and short-term notes, and commercial paper – fell 29.3% versus November totals. On a year-over-year basis, overall municipal volumes are down 20.3%. New Jersey led state-level municipal request volume with a total of 68 new CUSIP requests in December, followed by New York and Texas, each with 63.
“CUSIP request volumes in 2022 really told the story of a rising interest rate environment, with CDs becoming a huge beneficiary and municipals feeling the strain of the rising rates,” said Gerard Faulkner, Director of Operations for CGS. “As we look ahead to 2023, we expect corporate issuance to continue to be suppressed as we start the year and slightly ramp up if interest rates stabilize due to lower inflation later in the year.”
Requests for international equity CUSIPs rose 9.0% in December while international debt CUSIP requests fell 18.5%. On an annualized basis, international equity CUSIP requests are down 32.7% and international debt CUSIP requests were down 41.5%.
To view the full CUSIP Issuance Trends report for December, please click here.
Following is a breakdown of new CUSIP Identifier requests by asset class year-to-date through December 2022:
|Asset Class||2022 YTD||2021 YTD||YOY Change|
CDs < 1-year Maturity
|CDs > 1-year Maturity||6,980||4,211||65.8||%|
|Private Placement Securities||4,454||4,040||10.2||%|
U.S. Corporate Debt
|Short-Term Municipal Notes||903||962||-6.1||%|
Canada Corporate Debt & Equity
Long-Term Municipal Notes
|U.S. Corporate Equity||10,353||14,284||-27.5||%|
About CUSIP Global Services
The financial services industry relies on CGS’ unrivaled experience in uniquely identifying instruments and entities to support efficient global capital markets. Its extensive focus on standardization over the past 50 years has helped CGS earn its reputation as a trusted originator of quality identifiers and descriptive data, ensuring that essential front- and back-office functions run smoothly. Relied upon worldwide as the industry standard provider of reliable, timely reference data, CGS is also a founding member and co-operates the Association of National Numbering Agencies (ANNA) Service Bureau, a global security and entity identifier database for over 34 million public and privately traded instruments, contributed by 91 national numbering agencies and 25 partner agencies representing 120 different countries. CGS is managed on behalf of the American Bankers Association (ABA) by FactSet Research Systems Inc., with a Board of Trustees that represents the voices of leading financial institutions. For more information, visit www.cusip.com.
About The American Bankers Association
The American Bankers Association represents banks of all sizes and charters and is the voice for the nation’s $13 trillion banking industry and its 2 million employees. Learn more at www.aba.com.
For More Information:
+1 (631) 584.2200
- Sovos Brands Intermediate, Inc. Issues Allergy Alert on Undeclared Egg in Rao’s Slow Simmered Soup, Labeled as Chicken & Gnocchi but Containing Vegetable Minestrone - January 27, 2023
- Goal Acquisitions Corp. Issues Letter to Shareholders Regarding Proposed Combination with Digital Virgo - January 27, 2023
- Farmers & Merchants Bancorp (FMCB) Reports Record Year-End 2022 Financial Results - January 27, 2023