View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

FE D E R A L R E S E R V E BANK O F N E W Y O R K
Fiscal Agent of the United States
Circular No. 5 3 8 1 ~!
September 4, 1963 J

C
OFFERING OF TWO SERIES OF TREASURY BILLS

$1,300,000,000 of 91-Day Bills, Additional Amount, Series Dated June 13, 1963, Due December 12, 1963
(To Be Issued September 12, 1963)
$800,000,000 of 182-Day Bills, Dated September 12, 1963, Due March 12, 1964
To All Incorporated Banks and Trust Companies, and Others
Concerned, in the Second Federal Reserve District:

Following is the text of a notice issued by the Treasury Department, released for publication today at 4 p.m.,
Eastern Daylight Saving time:
The Treasury Department, by this public notice, invites
tenders for tw o series o f Treasury bills to the aggregate
amount of $2,100,000,000, or thereabouts, for cash and in ex­
change for Treasury bills maturing September 12, 1963, in the
amount of $2,100,529,000, as follow s:
91-day bills (to maturity date) to be issued September 12,
1963, in the amount of $1,300,000,000, or thereabouts,
representing an additional amount of bills dated
June 13, 1963, and to mature D ecem ber 12, 1963,
originally issued in the amount o f $800,929,000, the
additional and original bills to be freely interchange­
able.
182-day bills, for $800,000,000, or thereabouts, to be dated
September 12, 1963, and to mature March 12, 1964.
The bills of both series will be issued on a discount basis
under competitive and noncompetitive bidding as hereinafter
provided, and at maturity their face amount will be payable
without interest. They will be issued in bearer form only, and
in denominations of $1,000, $5,000, $10,000, $50,000, $100,000,
$500,000 and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and
Branches up to the closing hour, one-thirty p.m., Eastern D ay­
light Saving time, M onday, September 9, 1963. Tenders will not
be received at the Treasury Department, W ashington. Each
tender must be for an even multiple of $1,000, and in the case
of competitive tenders the price offered must be expressed
on the basis of 100, with not m ore than three decimals, e.g.,
99.925. Fractions may not be used. It is urged that tenders
be made on the printed forms and forwarded in the special
envelopes which will be supplied by Federal Reserve Banks
or Branches on application therefor.
Banking institutions generally may submit tenders for
account of customers, provided the names of the customers are
set forth in such tenders. Others than banking institutions
will not be permitted to submit tenders except for their own
account. Tenders will be received without deposit from incor­
porated banks and trust companies and from responsible and
recognized dealers in investment securities. Tenders from
others must be accompanied by payment o f 2 percent o f the
face amount o f Treasury bills applied for, unless the tenders
are accompanied by an express guaranty o f payment by an
incorporated bank or trust company.
Immediately after the closing hour, tenders will be opened
at the Federal Reserve Banks and Branches, follow ing which
public announcement will be made by the Treasury Depart­

ment of the amount and price range of accepted bids. Those
submitting tenders will be advised of the acceptance or rejec­
tion thereof. The Secretary of the Treasury expressly reserves
the right to accept or reject any or all tenders, in whole or in
part, and his action in any such respect shall be final. Subject
to these reservations, noncompetitive tenders for $200,000 or
less for the additional bills dated June 13, 1963 (91 days re­
maining until maturity date on Decem ber 12, 1963) and non­
competitive tenders for $100,000 or less for the 182-day bills
without stated price from any one bidder will be accepted in full
at the average price (in three decimals) of accepted com peti­
tive bids for the respective issues. Settlement for accepted
tenders in accordance with the bids must be made or completed
at the Federal Reserve Bank on September 12, 1963, in cash or
other immediately available funds or in a like face amount of
Treasury bills maturing September 12, 1963. Cash and exchange
tenders will receive equal treatment. Cash adjustments will
be made for differences between the par value of maturing bills
accepted in exchange and the issue price of the new bills.
The incom e derived from Treasury bills, whether interest
or gain from the sale or other disposition of the bills, does not
have any exemption, as such, and loss from the sale or other
disposition of Treasury bills does not have any special treat­
ment, as such, under the Internal Revenue Code o f 1954. The
bills are subject to estate, inheritance, gift or other excise
taxes, whether Federal or State, but are exempt from all taxa­
tion now or hereafter im posed on the principal or interest
thereof by any State, or any of the possessions of the United
States, or by any local taxing authority. For purposes of
taxation the amount of discount at which Treasury bills are
originally sold by the United States is considered to be interest.
Under Sections 454(b) and 1221(5) of the Internal Revenue
Code of 1954 the amount o f discount at which bills issued
hereunder are sold is not considered to accrue until such bills
are sold, redeemed or otherwise disposed of, and such bills
are excluded from consideration as capital assets. Accordingly,
the owner of Treasury bills (other than life insurance com ­
panies) issued hereunder need include in his incom e tax return
only the difference between the price paid for such bills,
whether on original issue or on subsequent purchase, and the
amount actually received either upon sale or redemption at
maturity during the taxable year for which the return is made,
as ordinary gain or loss.
Treasury Department Circular No. 418 (current revision)
and this notice prescribe the terms of the Treasury bills and
govern the conditions o f their issue. Copies o f the circular
may be obtained from any Federal Reserve Bank or Branch.

This Bank willreceivetenders forboth seriesup to 1:30 p.m., Eastern Daylight Saving time, Monday, September 9,
1963, at the Securities Department of 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 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,

Results of the last offering of Treasury bills (91-day bills to be issued September 5, 1963, representing an addi­
tional amount of bills dated June 6, 1963, and maturing December 5, 1963; and 182-day billsdated September 5, 1963,
maturing March 5, 1964) are shown on the reverse side of this circular.




A

lfred

H

a y es

,

President.

( over)

RESULTS OF LAST OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED
SEPTEMBER 5, 1963)

Range of Accepted Competitive Bids
91-Day Treasury Bills
Maturing December 5 ,1 9 6 3

Price

High ......... ......
Low .......... ......
Average ........ .....

99.146a
99.143
99.145

182-Day Treasury Bills
Maturing March 5 ,1 9 6 4

Approx. equiv.
annual rate

Price

98.242b
98.235
98.237

3.378%
3.390%
3.384%!

Approx. equiv.
annual rate

3.477%
3.491%
3.487%1

a Excepting one tender of $75,000.
b Excepting one tender o f $100,000.
1 On a coupon issue of the same length and for the same amount invested, the return on these bills w ould provide yields
of 3.47 percent for the 91-day bills, and 3.61 percent for the 182-day bills. Interest rates on bills are quoted in terms o f bank
discount, with the return related to the face amount of the bills payable at maturity rather than the amount invested, and their
length in actual number o f days related to a 360-day year. In contrast, yields on certificates, notes, and bonds are computed
in terms of interest on the amount invested, and relate the number o f days remaining in an interest payment period to the
actual number of days in the period, with semiannual com pounding if more than one coupon period is involved.

(10 percent of the amount of 91-day bills
bid for at the low price was accepted.)

(78 percent ofthe amount of 182-day bills
bid for at the low price was accepted.)

Total Tenders Applied for and Accepted (By Federal Reserve Districts)
91 -Day Treasury Bills
Maturing December 5 ,1 9 6 3
District

Accepted

Applied for

...
...
...
...
...
...
...
...
...
...
...

$ 34,957,000
1,798,992,000
27,901,000
23,268,000
11,422,000
17,474,000
283,994,000
33,878,000
21,975,000
33,939,000
27,585,000
125,460,000

$

Total .... ...

$2,440,845,000

$1,300,685,000c

Boston.........
New York ......
Philadelphia .....
Cleveland .......
Richmond .......
Atlanta ........
Chicago........
St. Louis........
Minneapolis ......
Kansas City ......
San Francisco ....

8,957,000
931,663,000
12,451,000
21,328,000
10,366,000
12,517,000
153,734,000
17,013,000
13,153,000
23,144,000
18,185,000
78,174,000

182-Day Treasury Bills
Maturing March 5 ,1 9 6 4
Applied for

$ 12,140,000
1,239,861,000
8,772,000
10,023,000
2,507,000
4,380,000
138,933,000
10,193,000
8,575,000
9,693,000
10,019,000
102,369,000

$ 5,740,000
682,035,000
3,772,000
8,673,000
1,482,000
3,952,000
56,356,000
5,149,000
5,445,000
6,143,000
5,619,000
17,099,000

$1,557,465,000

$801,465,000d

c Includes $212,954,000 noncompetitive tenders accepted at the average price of 99.145.
d Includes $49,455,000 noncompetitive tenders accepted at the average price o f 98.237.




Accepted