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F E D E R A L R E S E R V E BA N K O F N E W Y O RK Fiscal Agent of the United States [ Cseptemb«0i ,1m*73 OFFERING OF TW O SERIES OF TREASURY BILLS $1,200,000,000 of 91-Day Bills, Additional Amount, Series Dated June 11, 1959, Due Dec. 10, 1959 (To Be Issued September 10, 1959) $400,000,000 of 182-Day Bills, Dated September 10, 1959, Due March 10, 1960 To All Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve District: Following is the text o f a notice issued by the Treasury Department, released for publication in morning newspapers, Tuesday, September 1, 1959: T h e T r e a s u ry D epa rtm en t, b y this p u b lic n o tice , invites tenders fo r tw o series o f T rea su ry bills t o the a g g reg a te a m ou n t o f $1,600,000,000, o r th erea b ou ts, fo r cash and in e x ch a n g e fo r T r e a s u ry bills m a tu rin g S ep tem ber 10, 1959, in th e a m ou n t o f $1,600,320,000, as fo llo w s : 9 1 -d a y bills ( t o m aturity da te) to be issued S ep tem ber 10, 1959, in th e a m ou n t o f $1,200,000,000, o r thereabouts, rep re se n tin g an additional a m ou n t o f bills dated June 11, 1959, and to m ature D e ce m b e r 10, 1959, origin a lly issued in the a m ou n t o f $500,072,000, the a dd ition al and o rigin a l bills to be freely in terch angeable. 182-day bills, fo r $400,000,000, o r th ereabouts, to be dated S e p te m b e r 10, 1959, and to m ature M a rch 10, 1960. T h e bills o f b o th series w ill be issued on a d iscou n t basis u nder co m p etitive and n o n com p etitive bid d in g as h ereinafter p r o vid ed, and at m atu rity their face a m ou n t w ill be pa ya b le w ith ou t interest. T h e y w ill be issued in bearer fo rm on ly , and in de n om in ation 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 receiv ed at F ed eral R es e rv e B anks and B ran ches up to the clo s in g h our, on e-th irty o ’c lo c k p.m ., E astern D a y lig h t S a vin g tim e, F rida y, S ep tem ber 4, 1959. T e n d e rs w ill n ot be re ce iv e d at the T r e a s u ry D epa rtm en t, W a s h in g to n . E a ch ten der m ust be f o r an even m u ltiple o f $1,000, and in the case o f com p etitive tenders the p rice offered m u st t>e ex p ressed on the basis o f 100, w ith n o t m ore than th ree decim a ls, e.g., 99.925. F ra ctio n s m ay n o t be used. It is u rged that ten ders be m ade on th e printed fo rm s and fo rw a rd ed in th e special en velop es w hich w ill be sup plied b y Federal R e serv e B an ks o r B ra n ch es on a pp lica tion th erefor. O th e rs than b a n k in g institutions w ill n ot be perm itted to subm it tenders e x ce p t fo r th eir o w n a ccou n t. T en d ers w ill be received w ith ou t d ep o sit fr o m in corp ora ted banks and trust c o m panies and fro m resp on sib le and re co g n iz e d dealers in in vestm ent securities. T e n d e rs fr o m oth ers m u st b e a ccom p a n ied b y pay 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 applied fo r , unless the tenders are a ccom p a n ied b y an exp ress gu aranty o f paym ent b y an in co rp o ra ted bank o r trust com p a n y . Im m ed ia tely a fter the clo s in g h our, tenders w ill be op en ed at th e F ed era l R e se rve B anks and B ran ches, fo llo w in g w h ich p u b lic a n 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 the am ou nt and price ra n ge o f a ccep ted bids. T h o s e subm itting ten ders w ill be advised o f the a ccep ta n ce o r re je ctio n th ereof. T h e S ecreta ry o f the T rea su ry e x p ressly reserves th e righ t to a ccep t o r re je ct a n y o r all tenders, in w h o le o r in part, and his action in any such resp ect shall be final. S u b ject to these reserva tions, n on com p etitiv e tenders fo r $200,000 o r less fo r the add i tional bills dated June 11, 1959, (91 d a ys rem ain in g until m a tu r ity date on D e ce m b e r 10, 1959) and n o n co m p e titiv e ten ders f o r $100,000 o r less fo r the 182-day bills w ith ou t stated p rice fro m any o n e b idd er w ill be a ccep ted in full at the a vera ge p rice (in three d ecim a ls) o f a ccep ted com p etitive bids fo r the respective issues. Settlem ent fo r a ccep ted tenders in a ccord a n ce w ith the bids m u st be m ade o r com p leted at the F ed eral R e serv e B ank on S ep tem ber 10, 1959, in cash or oth er im m ediately available funds o r in a like face a m ou n t o f T r e a s u ry bills m a tu rin g S ep tem b er 10, 1959. Cash and ex ch a n g e ten ders w ill receiv e equal treatm ent. Cash adjustm ents w ill be m ade fo r d ifferen ces betw een the par valu e o f m atu rin g bills a ccep ted in ex ch a n g e and the issue price o f the n ew bills. T h e in com e derived fro m T rea su ry bills, w h eth er interest o r gain fro m the sale o r oth er d isp osition o f the bills, d o e s n o t have any exem ption , as su ch , and loss fr o m the sale o r oth er d isp o si tion o f T rea su ry bills d oes n ot have any special treatm ent, as such, under the Internal R even u e C o d e o f 1954. T h e bills are su b ject to estate, inheritance, g ift or oth er e x cis e taxes, w hether F ed eral o r State, b u t are ex em p t fro m all taxation n o w o r h ere after im p osed on the principal o r interest th ereof b y a n y State, o r a n y o f the p ossession s o f th e U n ited States, o r b y a n y local ta x in g authority. F o r p u rp oses o f taxation the a m ou n t o f dis co 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 t o be interest. U n d er S ection s 4 5 4 (b ) and 1221(5) o f the Internal R even u e C od e o f 1954 th e a m ou n t o f dis co u n t at w h ich bills issued hereun der are sold is n ot con sidered to accru e until such bills are sold, red eem ed o r oth erw ise dis posed o f, and such bills are exclu d ed fr o m con sid era tio n as capital assets. A c c o r d in g ly , th e 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 hereun der need in clu d e in his in com e tax return o n ly th e differen ce betw een the p rice paid fo r such bills, w h eth er on origin al issue o r on subsequen t pur ch ase, and the a m ou n t actu ally receiv ed either u pon sale o r redem ption at m aturity du rin g the ta x ab le yea r f o r w h ich the return is m ade, as ord in a ry gain o r loss. T rea su ry D ep a rtm en t C ircu lar N o . 418, R evised , and this n otice, prescrib e the term s o f the T r e a s u 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 obtain ed fro m a n y F ed eral R e s e rv e ,B a n k o r B ranch. This Bank will receive tenders for both series up to 1 :30 p.m., Eastern Daylight Saving time, Friday, Septem ber 4, 1959, at the Securities Department o f its Head Office and at its Buffalo Branch. Tender form s for the respective series are enclosed. Please use the appropriate form s to submit tenders and return them 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 T ax and Loan Account. Settlement must be made in cash or other immediately available funds or in maturing Treasury bills. This circular was printed before the results o f the bidding for Treasury bills to be issued September 3, 1959, were available; those results will be announced after release by the Treasury Department. A lfred H ayes, President. Closing date for receipt o f tenders is Friday, September 4.
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