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Dallas, Texas, March 31, 1960


To All Banking Institutions and Others Concerned
in the Eleventh Federal Reserve District:
There is quoted below a press statement issued today by the Treasury Department in regard to current
“The Treasury will borrow $2,500,000,000, or thereabouts, to cover its estimated requirements
for funds for the balance of the fiscal year ending June 30, 1960. These funds will be obtained from
the issue of:
“ 4 V 4 percent Treasury bonds to be dated April 5, 1960, and to mature M ay
callable at the option of the United States on any interest date on and after M ay
up to $1,500,000,000, at par and accrued interest for delivery and payment April
4 percent Treasury notes to be dated April 14, 1960, and to mature M ay
in an amount of $2,000,000,000, or thereabouts.

15, 1985,
15, 1975,
14, 1960,
15, 1962,

“T o the extent that the amount of public subscriptions to the 4Vi percent Treasury Bonds of
1975-85, when added to the amount of the 4 percent Treasury notes issued exceed $2,500,000,000
in the aggregate, the excess funds borrowed in this operation will be used by the Treasury to reduce
the amounts of the weekly issues of 91-day Treasury bills in the weeks ahead.
“In addition the Treasury will issue on April 15, 1960, $2,000,000,000 of 1-year Treasury bills,
to be sold at auction, the proceeds of which will be used to redeem $2,000,000,000 of quarterly
Treasury bills maturing on that date.
“The subscription books will be open for the Treasury bonds and notes only on Monday, April
4, and Tuesday, April 5, 1960. The Treasury bill auction will be held on Tuesday, April 12, 1960.

“Cash subscriptions to the 4 X percent Treasury bonds from commercial banks, for their own
account, and from States, political subdivisions or instrumentalities thereof, and public pension and
retirement and other public funds will be received without deposit.
“Savings-type investors will be permitted to pay for bonds allotted to them in installments up
to June 15, 1960 (n ot less than 40 percent by April 14, the delivery date; 70 percent by M ay 15;
and full payment by June 15). Amounts allotted to other classes of subscribers must be paid for in
full on April 14. All subscriptions from others than commercial banks for their own account and
from States, political subdivisions or instrumentalities thereof and public funds must be accompanied
by a cash down-payment of 20 percent at the time of the subscription. Commercial bank subscrip­
tions will be limited to an amount not exceeding 4 percent of the combined amount of time certificates
of deposit (but only those issued in the names of individuals, and o f corporations, associations, and
other organizations not operated for profit) and of savings deposits, or 10 percent of the combined
capital, surplus and undivided profits, whichever is greater. In addition to the amount offered for
public subscription, the Secretary of the Treasury may allocate up to $100,000,000 of these bonds
to Government Investment Accounts. Subscription books for this issue will be open on April 4
and April 5.
“All subscriptions will be allotted in full unless the total public subscriptions exceed $1,500,000,000. In that event subscriptions will be subject to allotment, except that subscriptions up to a

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maximum of $25,000 if they are accompanied by 100 percent payment at the time the subscriptions
are entered, will be allotted in full to all subscribers. Savings-type investors who may subscribe to
the 4 1 percent bonds on a deferred payment basis are:
Pension and Retirement Funds — public and private
Endowment Funds
Common Trust Funds under Regulation F of the Board of Governors o f the
Federal Reserve System
Insurance Companies
Mutual Savings Banks
Fraternal Benefit Associations and Labor Unions’ insurance funds
Savings and Loan Associations
Credit Unions
Other Savings Organizations (not including commercial banks)
State, Political Subdivisions or instrumentalities thereof, and
Public Funds.
“Where subscribers in this group (except States, political subdivisions or instrumentalities
thereof, and public pension and retirement and other public funds) elect to pay for such bonds in
installments, delivery of 5 percent of the total par amount allotted will be withheld until payment
for the total amount allotted has been completed. The bonds may be paid for by credit in Treasury
Tax and Loan accounts. The bonds will be redeemable at par prior to maturity in payment of
Federal Estate taxes if owned by the decedent at time of death.

“Subscriptions to the 4 percent Treasury Notes of M ay 15, 1962, from commercial banks,
for their own account, will be received without deposit, but will be restricted to 50 percent of the
combined capital, surplus and undivided profits of the subscribing bank, and subscriptions from all
others must be accompanied by payment of 2 percent of the amount of notes applied for not subject
to withdrawal until after allotment. Payment for 75 percent of these Treasury notes may be made
by credit in Treasury Tax and Loan accounts.

“The Secretary of the Treasury reserves the right to reject or reduce any subscription, to allot
less than the amount of bonds or notes applied for, and to make different percentage allotments to
various classes o f subscribers.
“Commercial banks and other lenders are requested to refrain from making unsecured loans,
or loans collateralized in whole or in part by the notes or bonds subscribed for, to cover the deposits
required to be paid when subscriptions are entered, and banks will be required to make the usual
certification to that effect.
“All subscribers to the bonds and notes are required to agree not to purchase or sell, or to
make any agreements with respect to the purchase or sale or other disposition o f the securities
subscribed for under this offering, until after midnight, April 5.
“Any subscriptions for the notes or the bonds addressed to a Federal Reserve Bank or Branch,
or to the Treasurer of the United States, and placed in the mail before midnight April 5, will be
considered as timely.

“The Treasury also will issue $2,000,000,000 or thereabouts, of 1-year Treasury bills on April
15, 1960, for cash or in exchange for the $2,003,000,000 of Treasury bills which mature on that
date. The new bills will be sold on an auction basis, and tenders for such bills will be received on
April 12, 1960. Payment for these bills cannot be made by credit in Treasury Tax and Loan accounts.
“Full details regarding the offering of the bills to be issued on April 15, 1960, will be released
next week.”
Official circulars and subscription forms for the Treasury notes and Treasury bonds will be mailed as
soon as possible. However, if the circulars and forms are not received by Tuesday, April 5, subscriptions may
be entered by mail or telegram, subject to confirmation on official subscription blanks.
Full details regarding the offering of Treasury bills to be issued on April 15, 1960, will be released
next week.
Yours very truly,
Watrous H. Irons

Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102