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FEDERAL RESERVE BANK O F NEW YORK v r Circular No. 3 9 8 7 1 L June 18, 1953 J Fiscal Agent o f the United States Offering o f $1,500,000,000 of 91-Day Treasury Bills Dated June 25, 1953 Maturing September 24, 1953 To all Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve District: Following is the text o f a notice published tod ay: F O R R E L E A S E , M O R N IN G N E W S P A P E R S , Thursday, June 18, 1953. TREASURY DEPARTM ENT W ashington T h e Secretary o f the Treasury, by this public notice, invites tenders for $1,500,000,000, or thereabouts, o f 91-day Treasury bills, for cash and in exchange for Treasury bills maturing June 25, 1953, in the amount o f $1,200,652,000, to be issued on a discount basis under competitive and non-com petitive bidding as hereinafter provided. The bills o f this series will be dated June 25, 1953, and w ill mature September 24, 1953, when the face amount w ill be payable w ithout interest. T h ey w ill be issued in bearer form only, and in denominations o f $1,000, $5,000, $10,000, $100,000, $500,000, and $1,000,000 (maturity value). Tenders will be received at Federal Reserve Banks and Branches up to the closin g hour, tw o o ’clock p.m., Eastern Daylight Saving time, M onday, June 22, 1953. Tenders w ill not be received at the Treasury Department, W ashington. Each tender must be for an even multiple o f $1,000, and in the case o f com petitive tenders the price offered must be expressed on the basis o f 100, with not m ore than three decimals, e.g., 99.925. Fractions may not be used. It is urged that tenders be made on the printed form s and forw arded in the special envelopes which w ill be supplied by Federal Reserve Banks or Branches on application therefor. Others than banking institutions will not be permitted to submit tenders except for their own account. Tenders w ill be received without deposit from incorporated banks and trust companies and from responsible and recognized dealers in invest ment securities. Tenders from others must be accom panied by payment o f 2 percent o f the face amount o f Treasury bills applied for, unless the tenders are accom panied by an express guaranty o f payment by an incorporated bank o r trust company. Im m ediately after the closing hour, tenders will be opened at the Federal Reserve Banks and Branches, follow in g which public announcement will be made by the Secretary o f the Treasury o f the amount and price range o f accepted bids. Those submitting tenders will be advised o f the acceptance or rejection thereof. The Secretary o f the Treasury expressly reserves the right to accept or reject any or all tenders, in whole or in part, and his action in any such respect shall be final. Subject to these reservations, non-com petitive tenders for $200,000 or less without stated price from any one bidder will be accepted in full at the average price (in three decim als) o f accepted com petitive bids. Settlement for accepted tenders in accordance with the bids must be made or com pleted at the Federal Reserve Bank on June 25, 1953, in cash or other immediately available funds or in a like face amount o f Treasury bills maturing June 25, 1953. Cash and exchange tenders will receive equal treatment. Cash adjustments w ill be made for differences between the par value o f maturing bills accepted in exchange and the issue price o f the new bills. T h e incom e derived from Treasury bills, whether interest or gain from the sale o r other disposition o f the bills, shall not have any exemption, as such, and loss from the sale or other disposition o f Treasury bills shall not have any special treat ment, as such, under the Internal Revenue Code, or laws amendatory or supplementary thereto. T he bills shall be subject to estate, inheritance, gift, or other excise taxes, whether Federal or State, but shall be exempt from all taxation now or here after im posed on the principal or interest thereof by any State, or any o f the possessions o f the United States, or by any local taxing authority. F or purposes o f taxation the amount o f discount at which Treasury bills are originally sold by the United States shall be considered to be interest. U nder Sections 42 and 117 (a ) (1 ) o f the Internal Revenue Code, as amended by Section 115 o f the Revenue A ct o f 1941, the amount o f discount at which bills issued hereunder are sold shall not be considered to accrue until such bills shall be sold, redeemed or otherwise disposed of, and such bills are excluded from consideration as capital assets. A ccordin gly, the ow ner o f Treasury bills (other than life insurance com panies) issued hereunder need include in his incom e tax return only the difference between the price paid for such bills, whether on original issue or on subsequent purchase, and the amount actually received either upon sale or redemption at maturity during the taxable year for which the return is made, as ordinary gain or loss. Treasury Departm ent Circular N o. 418, as amended, and this notice, prescribe the terms o f the Treasury bills and govern the conditions o f their issue. Copies o f the circular may be obtained from any Federal Reserve Bank or Branch. This Bank will receive tenders up to 2 p.m., Eastern Daylight Saving time, Monday, June 22, 1953, at the Securities Department o f its Head Office and at its Buffalo Branch. Please use the form on the reverse side o f this circular to submit a tender, and return it in an envelope marked “ Tender for Treasury Bills.” Tenders may be submitted by tele graph, subject to written confirmation; they may not be submitted by telephone. Payment for the Treasury bills cannot be made by credit through the Treasury Tax and Loan Account. immediately available funds or in maturing Treasury bills. Settlement must be made in cash or other A lla n S p r o u l, President. Results o f last offering o f Treasury bills (9 1 -d a y bills dated June 18, 1953, m aturing September 17, 1953) Total applied for . . .$2,206,694,000 Total accepted ........ $1,500,018,000 (includes $281,456,000 entered on a non-com petitive basis and accepted in full at the average price shown below ) A verage price . . . 99.437 Equivalent rate o f discount approx. 2.229% per annum Range o f accepted competitive bids: (excepting tw o tenders totaling $1,000,000) H i g h ..................... 99.444 Equivalent rate o f discount approx. 2.200% per annum L o w ..................... 99.432 Equivalent rate o f discount approx. 2.247% per annum (89 percent o f the amount bid for at the low price was accepted) Federal Reserve District Boston ....................... N ew Y o r k ................ Philadelphia ............ Cleveland .................. Richm ond ................ Atlanta ....................... Chicago .................... St. Louis .................. Minneapolis ............ Kansas City ............ Dallas ......................... San Francisco Total .......... . . Total Applied for $ 33,108,000 1,460,383,000 14,003,000 77,253,000 23,855,000 48,617,000 250,928,000 40,663,000 17,024,000 57,569,000 64,257,000 119,034,000 $2,206,694,000 Total Accepted $ 30,268,000 867,193,000 13,503,000 54,353,000 21,005,000 42,807,000 206,138,000 27,736,000 16,594,000 47,765,000 56,927,000 115,729,000 $1,500,018,000 ( over ) 29 N IM P O R T A N T — I f y o u desire to bid on a c o m p e t i t i v e basis, fill in rate per 100 and m atu rity value in paragraph headed "C om petitive Bid.” I f y o u desire to bid on a n o n - c o m p e t i t i v e basis, fill in only the m atu rity value in paragraph headed "N on -com petitive Bid.” D O N O T fill in b o t h p a r a g r a p h s o n o n e f o r m . A separate tender must -be used fo r each bid, except that banks subm itting bids on a com petitive basis fo r their ow n and their customers’ accounts m ay submit one tender fo r the total am ount bid at each price, provided a list is attached showing the name o f each bidder, the am ount bid fo r his accou n t, and method o f paym ent. Forms fo r this purpose w ill be furnished upon request. No............................. T E N D E R F O R 91 - D A Y T R E A S U R Y BILLS D ated June 25, 1953 M aturing September 24, 1953 Dated at To F e d e r a l R e s e rv e B a n k o f N e w Y o r k , Fiscal Agent o f the United States. 1953 C O M PE TITIV E BID N O N -C O M P E T IT IV E BID Pursuant to the provisions o f Treasury Department Circular No. 418, as amended, and to the provisions o f the public notice on June 18, 1953, as issued by the Secretary o f the Treas Pursuant to the provisions o f Treasury Department Circular No. 418, as amended, and to the provisions o f the public notice on June 18, 1953, as issued by the Secretary o f the Treas ury, the undersigned offers a non-competitive ury, the undersigned offers (R ate per 100) tender fo r a total amount o f $. (N ot to exceed $200,000) for a total amount o f $ ............................................... (maturity value) o f the Treasury bills therein described, or for any less amount that may be awarded, settlement therefor to be made at your Bank, on the date stated in the public notice, as indicated below : (maturity value) o f the Treasury bills therein described, at the average price (in three deci mals) o f accepted competitive bids, settlement therefor to be made at your Bank, on the date stated in the public notice, as indicated below: □ □ B y surrender o f maturing Treasury bills By surrender o f maturing Treasury bills amounting t o ................... $----------------------------------- amounting t o ................... $_______________________ □ □ By cash or other immediately available funds By cash or other immediately available funds *Price must be expressed on the basis o f 100, with not more than three decimal places, fo r example, 99.925. The Treasury bills for which tender is hereby made are to be dated June 25, 1953, and are to mature on September 24, 1953. This tender will be inserted in special envelope marked “ Tender for Treasury Bills.” Name o f Bidder (Please print) By ... (T itle) (Official signature required) Street Address ................................. (C ity, T ow n or Village, P. O. N o., and State) I f this tender is submitted by a bank for the account of a customer, indicate the customer’s name on line below : (N am e o f Customer) (C ity, T ow n o r V illage, P. O. N o., and State) IM P O R T A N T IN ST R U C T IO N S: 1. N o tender for less than $1,000 w ill be considered, and each tender must be for an even multiple o f $1,000 (maturity value). 2. If the person making the tender is a corporation, the tender should be signed by an officer o f the corpora tion authorized to make the tender, and the signing o f the tender by an officer o f the corporation w ill be construed as a representation by him that he has been so authorized. If the tender is made by a partnership, it should be signed by a member o f the firm, w ho should sign in the form “ ........................................................................................... . a copartnership, by .............................................................................................................................. . a m em ber o f the firm.” 3. Tenders will be received without deposit from incorporated banks and trust companies and from respon sible and recognized dealers in investment securities. Tenders from others must be accom panied by payment o f 2 percent o f the face amount o f Treasury bills applied for, unless the tenders are accom panied by an express guaranty o f payment by an incorporated bank or trust company. 4. I f the language o f this tender is changed in any respect, which, in the opinion o f the Secretary o f the Treasury, is material, the tender may be disregarded. P a y m e n t b y c r e d i t t h r o u g h T r e a s u r y T a x a n d L o a n A c c o u n t -will n o t b e p e r m it t e d . TENTB— 1199-a (OVER)