Assets of pension funds of United States corporations totalled $19.3 billion at the end of 1957, an increase during the year of $2.7 billion, or 16 percent, according to the annual survey of the Securities and Exchange Commission released today. In general, the 1957 growth and investment of these funds followed the patterns pointed out in earlier surveys. The survey covers all corporate pension funds except those administered by insurance companies. 1/ The growth in trusteed funds in 1957 compares with increases of $2.4 billion in 1956 and $2.1 billion in 1955. Assets of these funds for the years 1951-1957 inclusive, distributed by type of investment and by industry of employer are given in the accompanying Tables 1 and 2. ASSETS OF CORPORATE PENSION FUNDS DS-3927 As in each of the years surveyed, the greatest growth occurred in the pension funds of manufacturing companies, which during 1957 expanded by $1.8 billion, with total assets at the end of the year 1957 reaching $12.2 billion. Assets of other corporate funds increased $850 million during 1957 and totalled $7.1 billion at the close of the period. Within the manufacturing group, the largest growth again occurred in funds of iron and steel companies and automobile companies these two groups also having had the largest increases in every year since 1951, the first year covered in the Commission's surveys. At the end of 1957, total assets of the iron and steel group aggregated $1.8 billion. Next in order of magnitude were funds of petroleum companies, amounting to slightly over $1.5 billion, followed by the motor vehicle group with assets slightly under $1.5 billion. Among the non-manufacturing groups, the largest growth in 1957 again was in communication company funds, with assets totalling $2.8 billion. 1/ Reserves in insured funds increased $1.6 billion during 1957 and amounted to $14.0 billion at the end of 1957, according to the Institute of Life Insurance. At the close of 1957 assets of pension funds were distributed as follows: $15.8 billion, or 82 percent, was invested in corporate bonds and stocks, $2.0 billion in U. S. Government obligations, $400 million in cash and bank deposits, $300 million in mortgages, and $800 million in other assets. The most important type of investment continued to be corporate bonds, which aggregated $10.4 billion at the end of 1957. The net increase in the holdings for 1957 was $1.7 billion, as against $1.5 billion in 1956. The ratio of total assets invested in corporate bonds at the close of 1957 was 54 percent as compared with 45 percent in 1951, increases in this ratio being fairly constant during the intervening years. Three percent of total assets were invested in preferred stock which totalled $600 million, $40 million higher than in 1956. There was a further growth in common stock investments of approximately $1.0 billion. These holdings at the end of 1957 totalled $4.8 billion (book value), representing 25 percent of pension fund assets, compared with 12 percent in 1951, reflecting the sharp and steady growth in these investments in recent years. Based on market value, common stock investments comprised 30 percent of all pension fund assets at the end of 1957, compared with 32 percent in 1956, the lower ratio resulting from the decline in stock prices during 1957. The proportion of assets invested in common stock is higher for funds of trade, transportation and manufacturing companies than in other industries. Within the manufacturing group the ratio of common stock investments is highest in the iron and steel group. Common stock transactions in 1957 included purchases totalling $1.2 billion, almost $200 million more than in 1956. Sales in 1957 were slightly less than either of the two preceding years and totalled $200 million. In 1957, 37 percent of net receipts of pension funds were invested in common stock, a higher ratio than in any previous year. Purchases and sales of common stock, including stock of own company, for the years 1951 through 1957 were as follows: U. S. Government holdings again were reduced, and at the end of the period amounted to $2.0 billion. Although this was only slightly less than the amount of Governments held in 1951, in proportion to total assets there was a change from 32 percent (book value) in that year to 11 percent in the latest year surveyed. Mortgages owned by pension funds increased somewhat to over $300 million, but comprised less than 2 percent of total fund assets. Cash balances and investments in miscellaneous assets totalled $1.2 billion accounting for 6 percent of total assets, about the same proportion as in preceding years. |