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FEDERAL RESERVE BANK O F N EW YORK Fiscal Agent o f the United States [ Circular N o. 4 5 7 3 1 February 27, 1958 J Offering o f $1,800,000,000 o f 91-Day Treasury Bills Dated March 6, 1958 Maturing June 5, 1958 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, F eb ru a ry 27, 1958. TREASURY DEPARTM EN T W a s h in g to n T h e T re a su ry D epartm en t, b y this p u b lic n otice, invites tenders fo r $1,800,000,000, or thereabouts, o f 91-day T rea su ry bills, fo r cash and in e x ch a n g e fo r T rea su ry bills m atu rin g M a rch 6, 1958, in the a m ou n t o f $1,799,986,000, to be issued on a d isco u n t basis under com p etitive and n on co m p e titiv e b id d in g as h ereinafter provid ed . T h e bills o f this series w ill b e dated M arch 6, 1958, and w ill m ature June 5, 1958, w h en the face a m ou n t w ill be p ayable w ith ou t interest. T h e y w ill be issued in bearer fo r m o n ly, and in den om in a tion s o f $1,000, $5,000, $10,000, $100,000, $500,000 a n d $1,000,000 (m a tu rity v a lu e ). T e n d e rs w ill b e receiv ed at Federal R e serv e B anks and B ra n ch es up t o the clo s in g h ou r, o n e-th irty o ’ c lo c k p.m ., E astern Standard tim e, M o n d a y , M a rch 3, 1958. T en d ers w ill n ot be receiv ed at the T rea su ry D ep a rtm en t, W a s h in g to n . E ach ten der m u st be fo r an even m u ltiple o f $1,000, and in th e ca se o f com p etitiv e ten ders th e p rice o ffe re d m u st b e ex p re s se d on th e basis o f 100, w ith n ot m o re than th ree decim a ls, e.g., 99.925. F ra ction s m a y n ot be used. I t is u rg ed th at ten ders be m a d e o n th e prin ted fo rm s and fo rw a rd e d in the special en velop es w h ich w ill be su p plied b y F ed era l R e s e rv e B anks o r B ran ch es o n a p p lica tion th erefor. O th e rs than b a n k in g institutions w ill n ot be perm itted to su b m it ten ders e x ce p t fo r th eir o w n a ccou n t. T e n d e rs w ill be re ce iv e d w ith ou t d ep o sit fr o m in corp ora ted banks and trust com p a n ies and fr o m resp on sib le and re co g n iz e d dea lers in in vest m en t securities. T e n d e rs fr o m oth ers m u st be a ccom p a n ied b y p a y m en t o f 2 p ercen t o f th e fa ce a m ou n t o f T r e a s u ry bills a pplied fo r, unless the tenders are a ccom p a n ied b y an ex p ress gu a ra n ty o f p a y m en t b y an in corp ora ted bank o r tru st com p a n y . Im m e d ia te ly a fter the clo s in g h our, ten ders w ill be op en ed at the F ed era l R e s e rv e B an ks and B ra n ch es, fo llo w in g w hich p u b lic an n ou n cem en t w ill be m ade b y the T rea su ry D epa rtm en t o f th e a m ou n t a n d p rice ra n ge o f a cce p te d b ids. T h o s e su b m ittin g ten ders w ill b e a d vised o f the a ccep ta n ce o r re je ctio n th ereof. T h e S ecreta ry o f th e T r e a s u ry e x p re s sly reserves the righ t to a cce p 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 b e final. S u b ject to th ese reservations, n on com p etitiv e tenders fo r $200,000 or less w ith ou t stated p r ice fr o m a n y on e b idd er w ill be a ccep ted in full at the a vera ge p rice (in th ree decim a ls) o f a ccep ted com p etitiv e bids. S ettlem ent fo r a ccep ted tenders in a ccord a n ce w ith the bids m ust be m ade o r com p le te d at the Federal R eserve B ank on M a rch 6, 1958, in cash o r oth er im m ediately available funds o r in a like face am ou nt o f T rea su ry bills m atu rin g M a rch 6, 1958. Cash and ex ch a n g e ten ders w ill receiv e equal tr e a tm e n t C ash adju stm en ts w ill b e m ade fo r d ifferen ces b etw een the pa r va lu e o f m a tu rin g b ills a cce p te d in e x ch a n g e and th e issu e p rice o f th e n ew b ills. T h e in co m e derived fr o m T rea su ry bills, w h eth er interest o r gain fr o m th e sale o r oth er d isp osition o f th e b ills, d oes n ot have a n y e x e m p tion , as such, and loss fr o m th e sale o r oth er d isp osition o f T r e a s u ry bills d o e s n ot have a n y special treat m en t, as such, u nder th e Internal R even u e C o d e o f 1954. T h e bills are su b ject t o estate, in heritance, g ift o r oth er e x cis e taxes, w h eth er F ed eral o r State, but are exem pt fr o m all ta xation n o w o r h erea fter im p osed on the principal o r in terest th ere o f b y a n y State, o r a n y o f the possession s o f the U n ited States, o r b y any lo ca l ta x in g authority. F o r p u rp oses o f ta xation the am ou nt o f d isco u n t at w h ich T rea su ry bills are o rigin a lly sold b y the U n ited States is con sid ered to be in terest. U n d er S e ctio n s 4 5 4 (b ) and 1221(5) o f the Internal R even u e C o d e o f 1954 the a m ou n t o f d iscou n t at w h ich bills issued hereunder 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 o f, and such bills are ex clu d ed fro m con sidera tion as capital assets. A c c o r d in g ly , the ow n er o f T rea su ry bills (o th e r than life insurance co m p a n ie s ) issued h ereun der need in clu d e in his in com e ta x return o n ly the differen ce b etw een th e p rice pa id f o r such bills, w h eth er o n origin al issue o r o n subsequent pu rch ase, and the a m ou n t actu a lly receiv ed either u p on sale o r red em p tion at m a tu rity d u rin g the taxable yea r f o r w h ich the return is m ade, as ord in a ry gain o r loss. T r e a s u ry D epa rtm en t C ircu la r N o . 418, R evised , and this n otice, prescrib e th e term s o f th e T rea su ry bills a n d g o v e r n the co n d itio n s o f their issue. C op ies o f the circu la r m a y be ob ta in ed fr o m a n y F ed era l R e serv e B a n k o r B ran ch. This Bank will receive tenders up to 1 :30 p.m., Eastern Standard time, Monday, March 3, 1958, 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 telegraph, sub ject 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. Settlement must be made in cash or other immediately available funds or in maturing Treasury bills. A lfr e d H ayes, President. Results o f last offering o f T reasu ry bills (9 1 -d a y bills dated February 2 7 , 1 9 5 8 , m atu rin g M ay 2 9 , 1 9 5 8 ) T o t a l a pplied fo r . . $2,595,544,000 T o t a l a cce p te d ......... $1,800,475,000 (in clu d es $266,924,000 entered on a n on com p etitiv e basis and a ccep ted in full at the average p rice sh ow n b e lo w ) R a n g e o f a ccep ted com p etitive b id s: H ig h .................. Low A verage ........... 99.701 E quivalent rate o f discou n t a p p rox. 1.183% per annum 99.690 E quivalent rate o f discou n t a pp rox. 1.226% p er annum 99.696 E quivalent rate o f discou n t a p p rox. 1.202% p er annum Total A pplied for Federal Reserve District B o s to n ........................ N e w Y o r k ............... P h iladelphia ............. C leveland .................. R ich m o n d .................. A tlanta ........................ C h ica g o ...................... St. L ou is .................... M in n eap olis ............. K ansas C ity ............. D allas ......................... San F ra n cisco ......... . $ 21,963,000 1,850,566,000 38,627,000 43,837,000 12,141,000 45,275,000 233,964,000 20,618,000 14,249,000 46,651,000 51,024,000 216,629,000 Total Accepted $ 21,663,000 1,225,713,000 12,332,000 43,477,000 10,791,000 27,987,000 198,748,000 19,818,000 13,849,000 38,410,000 23,333,000 164,354,000 (8 percent o f the am ount bid fo r at the low p rice w as a cce p te d ) T ota l ......... $2,595,544,000 $1,800,475,000 ( oveb) No. TENDER FOR 91-DAY TREASURY BILLS Dated March 6,1958 To Maturing June 5, 1958 Dated at F ed eral R eserve B a n k o f N e w Y o r k , 1 9 ... Fiscal Agent o f the United States. Pursuant to the provisions o f Treasury Department Circular No. 418, Revised, and to the provisions of the public notice issued by the Treasury Department and printed on the reverse side of this tender, the under signed hereby offers to purchase the above described Treasury bills in the amount indicated below, and agrees to make payment therefor at your Bank on or before the issue date at the price indicated below: D o not fill in both Com petitive and N oncom petitive tenders on one form COMPETITIVE TENDER $ ........................................................(maturity value), or any lesser amount that may be awarded. P r i c e :.................................. per 100. (P r ic e m ust b e exp ressed with not m ore than three decimal places, f o r exam ple, 99.925) J | NONCOMPETITIVE TENDER ................................................(maturity value). $ ...................... (N o t to ex ceed $200,000 f o r one bidder through all sources) At the average price of accepted competitive bids. Subject to allotment, please issue, deliver, and accept payment for the bills as indicated below: Pieces Denomination M aturity value 1,000 5,000 10,000 E 100,000 500,000 Payment w ill be made as fo llo w s : □ 1. □ 2. Ship to the undersigned D 3. H old in safekeeping ( f o r ac count o f member bank on ly) □ 4. Allotment attached) □ 5. Special instructions: undersigned transfer (see list 1,000,000 (N o changes in delivery instructions will be accepted) Totals □ B y charge to our reserve account □ B y cash o r other immediately avail able funds □ B y surrender o f $ ........................... (m aturity value) o f maturing T reasu ry bills. Pay cash adjust ment, i f any— □ B y check □ B y credit to our reserve account (P aym en t cannot be made through Treasury T a x and Loan A ccou n t) The undersigned (if a bank or trust company) hereby certifies that the Treasury bills which you are hereby instructed to dispose o f in the manner indicated in item 3 above are solely owned by the undersigned. N a m e o f su b scrib er Insert this tender in special envelope marked ,tTender _ for Treasury Bills” _ (Please print) By ......................... T i t l e ............................... A d d re s s By (Official signature(s) required) ...................... . T i t l e ........... ........................................................................................................ (B anks submitting tenders f o r customer account must indicate name on line below , or attach a list) (N am e o f customer) (A ddress) IN S T R U C T IO N S : 1. N o ten der f o r less than $1,000 w ill be con sid e re d , and each ten d er m u st b e fo r an even m u ltiple o f $1,000 (m a tu rity v a lu e ). 2. O th e rs than b a n k in g in stitu tions w ill n ot be perm itted to subm it ten ders e x ce p t fo r their o w n a ccou n t. B anks su b m ittin g ten ders f o r c u sto m e r a cco u n t m a y co n so lid a te com p etitive tenders at the same price and m a y co n so lid a te n o n co m p e titiv e ten d ers, p r o v id e d a list is attached s h o w in g the nam e o f each bidder, the a m ou n t bid fo r his a cco u n t, and m e th o d o f pa ym en t. F o r m s f o r this pu rp ose w ill be furn ished on request. 3. I f th e p e r so n m a k in g the ten der is a co rp o ra tio n , the ten der sh ou ld be sign ed b y an officer o f th e co rp o ra tio n a u th o rize d to m a k e th e ten d er, a n d the sig n in g o f th e ten der b y an officer o f the co r p o r a tio n w ill be con stru ed as a representation b y h im that he has been s o au th orized . I f the ten der is m ade b y a partnersh ip, it sh ou ld be sign ed b y a m e m b e r o f the firm , w h o sh ou ld sign in the fo r m “ ............................................................................................... . a cop a rtn ersh ip , b y ................................................................................................................... . a m em b er o f the firm .” 4. T e n d e r s w ill be receiv ed w ith ou t d e p o s it fr o m in corp ora ted banks and trust co m p a n ie s and from re sp o n sible and re co g n iz e d dealers in in vestm ent securities. T en d ers fr o m oth ers m u st b e a cco m p a n ie d b y pa ym en t o f 2 p ercen t o f th e fa ce a m ou n t o f T rea su ry bills a pp lied fo r, u nless the ten ders are a ccom p a n ied b y an ex p re s s gu aranty o f paym ent b y an in co rp o ra te d b a n k o r trust com p a n y . 5. I f th e la n g u a ge o f this ten der is ch a n g ed in any resp ect, w hich, in the o p in io n o f the S ecreta ry o f the T re a su ry , is m aterial, the ten der m a y be disregarded. ( over)
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