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F E D E R A L R E S E R V E BANK O F N E W YORK Fiscal Agent of the United States r Circular No. 4 8 0 8 -1 L November 19, 1959 J O FFER IN G OF T W O SERIES OF T R E A S U R Y BILLS $1,200,000,000 of 90-Day Bills, Additional Amount, Series Dated Aug. 27, 1959, Due Feb. 25,1960 (To Be Issued November 27, 1959) $400,000,000 of 181-Day Bills, Dated November 27, 1959, Due May 26, 1960 T o A ll Incorporated Banks and T rust Companies, and Others Concerned, in the Second Federal R eserv e D istrict: F ollow in g is the text o f a notice issued by the Treasury Department, released for publication in morning newspapers, T h u rsd ay, N ovem ber 19, 1959: T h e T reasu ry D epartm ent, by this public notice, invites tenders fo r tw o series o f T reasu ry bills to the a ggregate amount o f $1,600,000,000, o r thereabouts, fo r cash and in exch an ge for T reasu ry bills m aturing N ovem ber 27, 1959, in the am ount o f $1,599,940,000, as fo llo w s : 90-day bills (to m aturity date) to be issued N ovem ber 27, 1959, in the am ount o f $1,200,000,000, o r thereabouts, representing an addition al am ount o f bills dated A ugust 27, 1959, and to mature Febru ary 25, 1960, o rigin a lly issued in the am ount o f $400,042,000, the addition al and o rigin a l bills to be freely interchangeable. 181-day bills, fo r $400,000,000, or thereabouts, to be dated N ovem ber 27, 1959, and to mature M ay 26, 1960. T h e bills o f both series w ill be issued on a discou nt basis under com petitive and n on com petitive bidding as hereinafter provided , and at m aturity their face am ount w ill be payable w ithout interest. T h e y w ill be issued in bearer form on ly, and in den om in ation s o f $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000,000 (m atu rity va lu e). T en ders w ill be receiv ed at Federal R eserve Banks and B ranches up to the closin g hour, one-thirty o ’ c lo ck p.m., E astern Standard tim e, M on day, N ovem ber 23, 1959. T en ders w ill n ot be received at the T reasu ry Departm ent, W ash ington. E ach tender must be fo r an even m ultiple o f $1,000, and in the case o f com petitive tenders the price offered must be e x pressed on the basis o f 100, w ith n ot m ore than three decim als, e.g., 99.925. F raction s m ay n ot be used. It is urged that tenders be m ade on the printed form s and forw a rded in the special envelopes w h ich w ill be supplied by F ed eral R eserve Banks o r B ranches on application therefor. O thers than banking institutions w ill n ot be perm itted to subm it tenders excep t fo r their ow n account. T en ders w ill be received w ith ou t deposit from in corporated banks and trust com panies and from responsible and recogn ized dealers in in vestm ent securities. T en ders from others must be accom panied by paym ent o f 2 percent o f the fa ce am ount o f T reasu ry bills applied for, unless the tenders are accom panied by an express guaranty o f paym ent b y an in corporated bank or trust com pany. Im m ediately a fte r the clo s in g hour, tenders w ill be opened at the F ed eral R eserve Banks and B ranches, fo llo w in g w hich public announcem ent w ill be made by the T reasu ry Departm ent o f the am ount and price range o f accepted bids. T h ose sub m itting tenders w ill be advised o f the acceptance or rejection thereof. T h e S ecretary o f the T reasu ry exp ressly reserves the right to accept o r reject any or a ll tenders, in w hole or in part, and his action in any such respect shall be final. S u b ject to these reservations, noncom petitive tenders for $200,000 or less fo r the addition al bills dated A u gu st 27, 1959, (90 days re m aining until m aturity date on F ebru ary 25, I960) and n on com petitive tenders for $100,000 or less fo r the 181-day bills w ithout stated price from any one bidder w ill be accepted in fu ll at the average price (in three decim als) o f accepted com petitive bids fo r the respective issues. Settlem ent for accepted tenders in a ccordance with the bids must be m ade or com pleted at the F ed eral R eserve Bank on N ovem ber 27, 1959, in cash or oth er im m ediately available funds or in a like face am ount o f T reasu ry bills m aturing N ovem ber 27, 1959. Cash and exch ange tenders w ill receive equal treatm ent. Cash adjustm ents w ill be made for differences betw een the par value o f m aturing bills a ccepted in exch a n ge and the issue price o f the new bills. T he incom e derived from T reasu ry bills, whether interest or gain from the sale or other d isp osition o f the bills, does not have any exem ption, as such, and loss from the sale or other disp osition o f T reasu ry bills does not have any special treat ment, as such, under the Internal Revenue C ode o f 1954. The bills are subject to estate, inheritance, g ift o r oth er excise taxes, whether Federal or State, but are exem pt from all ta x a tion now or hereafter im posed on the principal or interest th ereof by any State, o r any o f the possessions o f the United States, or by any local ta x in g authority. F or purposes o f ta x a tion the amount o f discou nt at w hich T reasu ry bills are origin a lly sold by the U nited States is con sidered to be interest. U nder S ections 454(b) and 1221(5) o f the Internal Revenue C ode o f 1954 the am ount o f discou nt at w hich bills issued hereunder are sold is not con sidered to accrue until such bills are sold, redeem ed or otherw ise disposed of, and such bills are exclu ded from con sideration as capital assets. A ccord in g ly , the ow ner o f Treasu ry bills (oth er than life insurance c o m panies) issued hereunder need include in his incom e ta x return only the difference between the price paid fo r such bills, whether on origin a l issue or on subsequent purchase, and the am ount actually received either upon sale or redem ption at maturity during the taxable year for which the return is made, as ord in a ry gain o r loss. Treasu ry Department C ircu lar N o. 418, Revised, and this notice, prescribe the terms o f the Treasu ry bills and govern the con ditions o f their issue. Copies o f the circu la r may be obtained from any Federal Reserve Bank o r Branch. T h is Bank w ill receive tenders for both series up to 1 :30 p.m., Eastern Standard time, M onday, N ovem ber 23, 1959, at the Securities D epartm ent o f its H ead O ffice and at its B uffalo Branch. T en d er form s for the respective series are enclosed. Please use the appropriate form s to subm it tenders and return them in an en velope m arked “ T en d er for T reasu ry B ills.” Ten ders m ay be subm itted b y telegraph, su bject 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. R esults o f the last offerin g o f T reasu ry bills (91-day bills to be issued N ovem ber 19, 1959, representing an additional am ount o f bills dated A u gu st 20, 1959, and m aturing February 18, 1960; and 182-day bills dated N ovem b er 19, 1959, m aturing M ay 19, 1960) are show n on the reverse side o f this circular. A lfred H a y e s, President. Please note that the current offering is for 90-day and 181-day Treasury bills. ( over) RESULTS OF LAST OFFERING OF TREASURY BILLS (TWO SERIES ISSUED NOVEMBER 19, 1959) Range of Accepted Competitive Bids 91-Day Treasury Bills Maturing February 18, 1960 182-Day Treasury Bills Maturing May 19, 1960 Approx. equiv. annual rate Price Approx. equiv. annual rate 98.935* 4.213% 97.628b 4.692% L o w .......................... ........ 98.888 4.399% 97.590 4.767% A verage 98.905 4.332% 97.602 4.744% Price H igh ........ ................. ........ a E x ce p tin g tw o tenders tota lin g $250,000. b E x cep tin g fou r tenders totalin g $1,210,000. (26 percent o f the am ount o f 91-day bills bid fo r at the lo w price w as accepted.) (66 percent o f the am ount o f 182-day bills bid fo r at the lo w price was accepted.) Total Tenders Applied for and Accepted (By Federal Reserve Districts) 91-Day Treasury Bills Maturing February 18, 1960 Applied for District B oston ............................ ......... $ 42,241,000 182-Day Treasury Bills Maturing May 19, 1960 Accepted $ 31,464,000 Applied for $ 7,524,000 Accepted $ 4,424,000 N ew Y o r k ..................... ......... 1,395,324,000 786,224,000 609,500,000 275,420,000 Philadelphia ................. ......... 33,962,000 23,962,000 9,869,000 2,869,000 Cleveland ..................... ......... 32,883,000 32,883,000 21,207,000 16,207,000 R ich m on d ..................... ......... 14,806,000 14,806,000 1,640,000 1,640,000 .......................... ......... 26,875,000 25,705,000 6,416,000 5,616,000 C h icago .......................... ......... 148,366,000 102,366,000 67,742,000 31,902,000 St. L ou is ....................... ......... 28,001,000 28,001,000 5,786,000 5,786,000 ................. ......... 11,023,000 11,023,000 3,395,000 2,445,000 K ansas C ity ................. ......... 65,834,000 62,834,000 6,336,000 6,236,000 D a l l a s .............................. ......... 22,776,000 22,776,000 8,056,000 8,041,000 San F ran cisco ............. ......... 73,651,000 58,281,000 55,775,000 39,527,000 T o t a l s ............. ........ $1,895,742,000 A tlan ta M inneapolis $1,200,325,000c c Includes $247,221,000 noncompetitive tenders accepted at the average price o f 98.905. d Includes $53,624,000 noncompetitive tenders accepted at the average price o f 97.602. $803,246,000 $400,113,000d
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