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FE D E R A L R E SE R V E BANK O F NEW YORK Fiscal Agent of the United States r Circular N o . 5 0 3 8 1 I M a y 2 2 , 1961 J OFFERING OF TWO SERIES OF TREASURY BILLS $1,000,000,000 of 91-Day Bills, Additional Amount, Series Dated March 2, 1961, Due Aug. 31, 1961 (T o Be Issued June 1,1961) $500,000,000 of 182-Day Bills, Dated June 1, 1961, Due November 30, 1961 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 today at 4 p.m.. Eastern Daylight Saving tim e: T h e T r e a s u ry D ep a rtm en t, b y this p u b lic n otice, invites ten ders f o r t w o series o f T rea su ry bills t o the a g g reg a te am ount o f $1,500,000,000, o r th ereabouts, fo r cash and in ex ch a n g e for T re a su ry bills m a tu rin g June 1, 1961, in the a m ou n t o f $1,501,190,000, as fo llo w s : 9 1-d ay bills ( t o m aturity da te) to be issued June 1, 1961, in the am ou nt o f $1,000,000,000, or th ereabouts, rep re sen tin g an a dd ition al a m ou n t o f bills dated M a rch 2, 1961, and to m ature A u g u s t 31, 1961, o rigin a lly issued in the a m ou n t o f $500,141,000, the addition al and original bills to be freely in terch angeable. 182-day bills, fo r $500,000,000, o r th ereabouts, to be dated June 1, 1961, and t o m ature N o v e m b e r 30, 1961. T h e bills o f b o th series w ill be issued on a discou n t basis u nder co m p e titiv e and n o n com p etitiv e b id d in g as h ereinafter p r o vid ed, and at m atu rity their fa ce a m ou n t w ill b e p a ya b le w ith ou t in terest. T h e y w ill be issued in bearer fo rm on ly, and in d e 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 eserve B anks and B ra n ch e s up t o 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 v in g tim e, F rida y, M a y 26, 1961. T en d ers w ill not be receiv ed at the T re a 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 the ca se o f co m p etitive tenders the p rice o ffe re d m u st be exp ressed on the basis o f 100, w ith n o t m o re than th ree decim a ls, e.g., 99.925. F ra ctio n s m ay n ot b e used. It is u rged that tenders be m ade on the printed fo rm s and fo rw a rd ed in the special en velopes w hich w ill be supplied b y Federal R e serv e B an ks o r B ra n ch es on a pp lication 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 xcep t fo r their o w n a ccou n t. T en d ers w ill be receiv ed w ith ou t d ep o sit fro m in corp ora ted banks and trust c o m panies and from re sp o n sib le and re co g n iz e d dealers in investm ent securities. T e n d e rs fro m oth ers m u st b e a ccom p a n ied b y p a y m en t o f 2 p e rce n t o f the fa ce a m ou n t o f T rea su ry bills applied fo r, unless the ten ders are a ccom p a n ied b y an exp ress guaranty o f pa ym en t b y an in co rp ora ted b a n k o r trust com p a n y . Im m ed ia tely a fter the c lo s in g h our, ten ders will be op en ed at the F ed eral R e se rve B anks and B ra n ch es, fo llo w in g w h ich public a n n ou n cem en t w ill b e m ade b y the T r e a s u ry D ep a rtm en t o f the a m ou n t and p rice 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 thereof. T h e S ecreta ry o f the T rea su ry ex p ressly reserves the rig h t to a ccep t o r r e je c t a n y o r all ten ders, in w h ole o r in part, and his a ction in a n y such resp ect shall be final. S u b je ct to th ese reser vations, n on com p etitiv e tenders fo r $200,000 o r less fo r the addition al bills dated M arch 2, 1961, (91 da ys rem ain in g until m aturity date on A u g u st 31, 1961) and n on com p etitiv e tenders for $100,000 o r less fo r the 182-day bills w ith ou t stated price fro m a n y on e b id d 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 b id s fo r th e respective issues. S ettlem ent fo r a ccep ted ten ders in a cco rd a n ce w ith the b id s m ust be m a d e o r com p le te d at the F ed era l R e se rv e B ank o n June 1, 1961, in cash o r oth er im m ediately available funds o r in a like face a m ou n t o f T rea su ry bills m atu rin g June 1, 1961. Cash and ex ch a n g e ten ders w ill receiv e eq u a l treatm en t. Cash adju stm en ts w ill be m ade fo r d ifferen ces betw een th e par value o f m a tu rin g bills a ccep ted in ex ch a n g e and th e issue price o f the n ew bills. T h e in com e derived fro m T r e a s u ry bills, w hether interest o r gain fr o m the sale o r oth er d isp osition o f the bills, d o e s n ot have a n y ex em p tion , as such, and loss fr o m the sale o r oth e r d isp o si tion o f T rea su ry bills d o e s n ot have any special treatm ent, as such, u nder the Internal R even u e C od e o f 1954. T h e bills are su b ject to estate, inheritance, gift o r 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 e re after im p osed on the principal or interest th ereof b y a n y State, or any o f the p ossession s o f the U n ited States, o r b y any loca l taxing authority. F o r pu rp oses o f taxation the a m ou n t o f dis cou 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 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 the a m ou n t o f dis co u n t at w hich bills issued hereun der are s o ld is n ot co n sid e re d to a ccru e until such bills are sold , red eem ed o r oth erw ise dis posed o f, and such bills are ex clu d ed fr o 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 r e a s u ry bills (oth er than life in su rance co m p a n ie s ) issued h ereu n der n eed in clu d e in his in com e ta x return on ly the differen ce b etw een the p rice paid fo r such bills, w h eth er on origin a l issue or on su b seq u en t p u r chase, and the a m ou n t actu ally receiv ed eith er u p on sale or red em ption at m aturity d u rin g th e ta x ab le yea r fo r w h ich the return is m ade, as ord in a ry gain o r loss. T rea su ry D epa rtm en t C ircu lar N o . 418, R ev ised , and this n otice, p rescrib e the term s o f the T rea su ry bills and g o v e r n the con d ition s o f their issue. C op ies o f the circu la r m a y b e obtain ed fro m a n y F ed era l R e serv e B ank o r B ranch. This Bank will receive tenders for both series up to 1 :30 p.m., Eastern Daylight Saving time, Friday, M ay 26, 1961, at the Securities Department o f its Head Office and at its Buffalo Branch. Tender forms for the respective series are enclosed. Please use the appropriate forms 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 mode 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 May 25, 1961, were avail able; those results will be announced after release by the Treasury Department. A l f r e d H a y e s , President. Closing date for receipt of tenders is Friday, May 26. AT 5038 FE D E RA L R E SE R V E BANK O F NEW YORK May 22,1961. T o A ll Banking Institutions in the Second Federal Reserve D istrict: W e are pleased to announce that S tate Bank of P la in fie ld , Plainfield, New Jersey, a newly organized bank, was admitted to membership in the Federal Reserve System today. The capital o f the bank is $500,000 and its surplus, $425,000. Principal officers of the bank a r e : Joseph L. P. G o ld s te in R a y m o n d B ir d H . G. S t e r l in g Chairman President Executive Vice President The A.B.A. transit number and check routing symbol o f State Bank of r>i ■ ft i/i * 55-737 Plainfield i s --------- 2 1 2 A lfred H ayes, P resid en t.