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FEDERAL RESERVE BANK O F N EW YORK r C ircular No. 4 3 0 6 1 L January 26, 1956 J Fiscal Agent of the United States Offering o f $1,600,000,000 of 91-Day Treasury Bills Dated February 2 ,1 9 5 6 Maturing May 3, 1956 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 today: 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 , T h u rsd a y, January 26, 1956. TREASU RY DEPARTM EN T W ashington T h e T re a su ry D epartm en t, b y this pu blic n otice, invites tenders fo r $1,600,000,000, o r th ereabouts, o f 91-day T rea su ry bills, fo r cash and in exch a n ge fo r T rea su ry bills m a tu rin g F eb ru a ry 2, 1956, in the a m ou n t o f $1,602,167,000, to be issued on a discou n t basis under com p etitive and n on com p etitive b id d in g as h ereinafter provided . T h e bills o f this series w ill be dated F eb ru a ry 2, 1956, and w ill m ature M a y 3, 1956, w h en the face a m ou n t w ill be payable w ith ou t interest. T h e y w ill be issued in bearer fo rm on ly, and in den om in a tion s o f $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000,000 (m a tu rity v a lu e ). T e n d e rs w ill be received at F ed era l R eserve B anks and B ra n ch es up to the clo s in g h our, o n e-th irty o ’ c lo c k p.m ., E astern S tandard tim e, M o n d a y , January 30, 1956. T en d ers w ill n ot be receiv ed at the T rea su ry D epa rtm en t, W a s h in g to n . E a ch ten der m u st be fo r an even m u ltiple o f $1,000, and in the case o f com p etitive ten ders the price offered m ust be exp ressed on the basis o f 100, w ith n ot m ore than three decim als, e. g ., 99.925. F raction s m a y n ot be used. It is u rged that ten ders be m ade o n the printed fo rm s and forw a rd ed in the special en v elop es w h ich w ill be supplied b y F ed eral R e serv e B anks o r B ran ch es o n a pp lica tion th erefor. O th e rs than b ank in g institutions w ill n ot be perm itted t o subm it tenders excep t fo r their o w n a ccou nt. T e n d e rs w ill be receiv ed w ith ou t d ep o sit fro m in corp ora ted banks and trust com p a n ies and fr o m respon sib le and recog n ized dealers in invest m en t securities. T e n d e rs fro m oth ers m u st be a ccom p a n ied b y paym ent o f 2 p ercen t o f the face am ou nt o f T r e a s u ry bills applied fo r, unless the tenders are a ccom p a n ied b y an exp ress gu a ra n ty o f paym ent b y an in corp ora ted b a n k or trust com p a n y . Im m ed ia tely after the clo s in g h our, tenders w ill be op en ed at the Federal R e serv e Banks and B ranches, fo llo w in g w h ich p u blic a n n ou n cem en t w ill be m ade b y the T rea su ry D ep a rtm en t o f the a m ou n t and price range o f a ccep ted bids. T h o s e su b m ittin g tenders w ill be advised o f the a ccep ta n ce or re je ctio n th ereof. T h e S ecretary o f the T rea su ry ex p ressly reserves the righ t t o a ccep t o r re je ct a n y o r all tenders, in w h o le or in part, and his a ction in a n y such resp ect shall be final. S u b je ct t o these reserva tion s, n on com petitive tenders fo r $200,000 o r less w ith ou t stated price fro m any on e b idd er w ill be a ccep te d in full at the a vera ge price (in three decim a ls) o f a ccep ted co m p e titiv e bids. Settlem ent for a ccep ted ten ders in a ccord a n ce w ith the bids m u st be m ade or com p leted at the F ed era l R e s e rv e B ank on F ebru ary 2, 1956, in cash o r oth er im m ediately available fun ds o r in a like face am ou nt o f T rea su ry bills m a tu rin g F ebru ary 2, 1956. Cash and ex ch a n g e ten ders w ill re ceive equal treatm ent. Cash adjustm ents w ill be m ade fo r d ifferen ces betw een the par value o f m a tu rin g bills a ccep ted in e x ch a n g e a n d the issue price o f th e n ew bills. T h e in co m e derived fro m T rea su ry b ills, w hether interest o r gain from the sale o r oth er d isp osition of the b ills, does n o t have a n y e x e m p tion , as such, and loss fr o m the sale o r oth er d isp osition o f T rea su ry bills d oes n ot have a n y sp ecia l treat m en t, as such, under the Internal R even u e C od e o f 1954. T h e bills are subject to estate, inheritance, g ift o r oth er e x cis e taxes, w hether F ed eral o r State, but are exem pt fro m all taxation n o w o r hereafter im p osed on the principal o r interest th ereof b y a n y State, o r any o f the p ossession s o f the U n ited States, or b y a n y loca l ta x in g authority. F o r pu rp oses o f ta xation the a m ou n t o f d iscou n t at w hich T rea su ry bills are o rigin a lly s o ld b y th e U n ited States is con sidered t o be interest. U n d e r S e ctio n s 4 5 4 (b ) and 1221(5) o f the Internal R even u e C od e o f 1954 the a m ou n t o f d iscou n t at w hich bills issued hereun der are so ld is n o t co n sid ered t o a ccru e until such bills are sold , red eem ed o r oth erw ise disp osed of, and such bills are exclu d ed fro m con sidera tion as capital assets. A c c o r d in g ly , the o w n e r o f T rea su ry bills (oth er than life insurance com p a n ies) issued h ereunder need in clude in his in com e ta x return on ly the differen ce betw een the price paid fo r such bills, w h eth er on origin a l issue o r o n subsequen t purchase, and the a m ou n t actu a lly receiv ed either u pon sale o r redem ption at m atu rity d u rin g the taxable year fo r w hich th e return is m ade, as ord in a ry gain o r loss. T rea su ry D epartm en t C ircu lar N o . 418, R evised , and this n otice, p rescrib e the term s o f the T rea su ry bills and g o v e rn the con d ition s o f their issue. C op ies o f the circu la r m ay be ob ta in ed fro m a n y Federal R eserve B ank o r B ranch. This Bank will receive tenders up to 1 :30 p.m., Eastern Standard time, Monday, January 30, 1956, at the Securi ties 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 telegraph, subject to written confirmation; they may not be submitted by telephone. Payment fo r the Treasury bills cannot be made by credit through the Treasury Tax and Loan Account. Settlement must be made in cash or other immediately available funds or in maturing Treasury bills. A lla n S p r o u l, President. Results of last offering of Treasury bills (91-d a y bills dated January 26 , 1956, maturing April 2 6, 1956) T o ta l a pplied f o r .......... $2,596,116,000 T o ta l a c c e p t e d ...............$1,600,865,000 (in clu des $255,546,000 entered on a n on com petitive basis and accepted in full at the average p rice show n b e lo w ) A v era ge price........ 99.433 E q u iva len t rate o f discou nt app rox. 2.245% p er annum R a n g e o f a ccep ted com p etitive b ids: H i g h ..................... 99.440 E quivalent rate a p p rox. 2 .215% L o w ..................... 99.429 E quivalent rate a p p rox. 2 .259% o f discou nt per annum o f discou nt p er annum Federal Reserve District B o s to n .............................. N ew Y o r k ........................ Philadelphia C leveland ........ R ich m o n d ........ A tlanta ........... C h ica g o ........... St. L o u i s .......... M in n eap olis .... K ansas C ity .... D allas ............... San F ra n cisco Total Applied for $ 23,702,000 1,920,633,000 37.025.000 65.208.000 15.249.000 30.043.000 255.340.000 33.052.000 . T o t a l ......................... $ 23,302,000 1,035,564,000 20.986.000 55.545.000 13.624.000 27.893.000 208.098.000 32.106.000 . 12 211.000 12 211.000 47.904.000 36.168.000 119.581.000 43.407.000 27.727.000 100.402.000 $2,596,116,000 $1,600,865,000 (5 3 p e r c e n t o f th e a m o u n t b id f o r at t h e lo w p r ic e w a s a c c e p t e d ) Total Accepted ( over) 34 T y '* V '* r 0 OF.* < ' ' - . IMPORT A N T — If you desire to bid on a competitive basis, fill in rate per 100 and maturity value in paragraph headed "Competitive Bid.” If you desire to bid on a noncompetitive basis, fill ill oilly the maturity value in paragraph headed "Noncompetitive Bid.” DO N O T fill in both paragraphs on one form . A separate tender must be used for each bid, except that banks submitting bids on a competitive basis fo r their ow n and their customers’ accounts may submit one tender fo r the total amount bid at each price, provided a list is attached showing the name o f each bidder, the amount bid fo r his account, and method o f payment. Forms fo r this purpose will be furnished upon request. N o___ ;__________ TENDER FOR 91-D A Y TREASURY BILLS Dated February 2, 1956 To F ederal R eserve B a n k of N e w Y o rk Maturing May 3, 1956 Dated at.. , Fiscal Agent o f the United States. .1956 COMPETITIVE BID NONCOMPETITIVE BID Pursuant to the provisions o f Treas ury Department Circular No. 418, Revised, and to the provisions o f the public no tice on January 26, 1956, as issued by the Treasury Department, the undersigned offers _________________________* for a total amount of (B a t e p e r 100) $______________________________ (maturity value) Pursuant to the provisions o f Treasury De partment Circular No. 418, Revised, and to the provisions o f the public notice on January 26, 1956, as issued by the Treasury Department, the undersigned offers a noncompetitive tender for a total amount of (N o t t o e x c e e d $200,000) of 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) of accepted competitive bids, settlement therefor to be made at your Bank, on the date stated in the public notice, as indicated below: □ □ By surrender o f maturing Treasury bills By surrender of maturing Treasury bills amounting to . . . . . " ............ $—— ------------------------ amounting t o ...... ................$____________________ □ □ By cash or other immediately available f unds By cash or other immediately available funds * P rice must be expressed on the basis o f 100, with not m ore than three decimal places, f o r exam ple, 99.925. The Treasury bills for which tender is hereby made are to be dated February 2, 1956, and are to mature on May 3, 1956. This tender will be inserted in special envelope marked “ Tender for Treasury Bills.” N a m e o f B id d er ............................................................................................................................................ (P le a s e p r in t ) B y ............... (O fficia l s ig n a tu re r e q u ir e d ) (T itle ) S treet A d d ress (C ity , T o w n o r V illa g e , P. O. N o ., a n d S ta te) If this tender is submitted by a bank for the account of a customer, indicate the customer’s name on line below: (N a m e o f C u s to m e r) (C it y , T o w n o r V U la ge , P . O . N o., a n d S ta te) IM PORTANT INSTRUCTIONS: 1. N o ten der fo r less than $1,000 w ill be con sidered, and each tender m u st be fo r an even m u ltiple o f $1,000 (m a tu rity va lu e). 2. I f the person m a k in g the ten der is a corp ora tion , the tender sh ou ld be sign ed b y an officer o f the co rp o ra tion a uthorized to m ake the tender, and the sign in g o f the ten d er b y an officer o f the corp ora tion w ill be con stru ed as a represen tation b y h im that he has b een so a uthorized. I f the ten der is m ade b y a partnership, it sh ou ld be sign ed b y a m e m b e r o f the firm , w h o should sign in the fo r m “ ...................................... ................................................................ a cop artn ersh ip, b y .............................. ....... ...... ......................................................................... a m em ber o f the firm .” 3. T en d ers w ill be received w ith ou t deposit from in corpora ted banks and trust com panies and fro m resp on sible and recog n ized dealers in investm ent securities. T e n d e rs fro m oth ers m ust be a ccom pa n ied b y paym ent o f 2 percent o f the face am ou nt Of T r e a su ry bills applied fo r, u nless the tenders are accom panied b y an exp ress gu aranty o f paym ent b y an in corpora ted bank o r trust com pan y. 4. I f the language o f this tender is ch anged in any respect, w hich, in the opin ion o f the Secretary o f the T reasu ry , is m aterial, the ten der m a y be disregarded. Payment by credit through Treasury Tax and Loan Account will not be permitted. http://fraser.stlouisfed.org/ T E N T B — 1 3 3 5 -a (OVER) Federal Reserve Bank of St. Louis