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FEDERAL RESERVE BANK OF DALLAS
F IS C A L A G EN T O F T H E U N IT E D S T A T E S

Dallas, Texas, July 8,1964
PRELIMINARY ANNOUNCEMENT
ADVANCE REFUNDING OFFER
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 an
advance refunding:
The Treasury today announced that the further improvement of its cash position at the
close of June makes unnecessary any substantial cash borrowing at this time. Instead, the
Treasury is offering holders of the four note issues due in August and November of this year
and five other selected note and bond issues maturing from May 1965 to February 1967 an
opportunity to extend the maturity of their holdings at attractive yields. Three issues are being
offered in exchange: An additional amount of the outstanding 4% bonds due October 1, 1969,
a new 4%% bond due November 15, 1973, and an additional amount of the outstanding 4^4%
bonds due in August 1992. The securities eligible for exchange and those being newly offered
are as follows:
Securities eligible for exchange
and their maturity dates

Securities offered in exchange
and their maturity dates

5%
notes 8/15/64
T
33,4% notes 8/15/64
4% bonds 10/1/69
47/8 % notes 11/15/64
(reopened issue)
334% notes 11/15/64
41/ 3 % bonds 11/15/73
37/8 % notes
5/15/65
(new issue)
3 % % notes
2/15/66
4 1 4 % bonds 8/15/87-92
33,4% bonds 5/15/66
(reopened issue)
4%
notes 8/15/66
3 % % notes
2/15/67
Exchange subscription books will be open for four days, July 13-16. Because of differences
in coupon and maturity among the various eligible issues, cash adjustments will be made to
provide all subscribers with appropriately attractive opportunities, as shown in the table on
the reverse side.
The public holds $7.6 billion of the four August and November 1964 maturities and about
$8.4 billion is held by official accounts. These issues are nearer to final maturity than any issues
included in previous advance refunding offers. Consequently their holders are not being offered
the nontaxable exchange privilege that is, as has been customary, being made available to
the other five issues eligible for this advance exchange.
The five eligible issues maturing from May 1965 to February 1967 involve $19.0 billion of
public holdings. This total is somewhat larger than that involved in the most recent advance
refunding in January but is smaller than the total offered in September 1963. Official accounts
hold about $6.8 billion of the 1965-1967 maturities.
The Treasury is in a position to undertake this advance refunding operation because its
immediate cash needs are much smaller than had been anticipated earlier. At this time, cash
borrowing is being confined to increases in the weekly bill issue, beginning with $100 million
for the issue dated July 16. The Treasury’s cash needs over the balance of the calendar quarter
will require sufficient borrowing to permit timely additions to the supply of Treasury bills as
necessary to counter any undue downward pressure on Treasury bill yields.
The official circulars, subscription forms, and other material containing additional details of the
offering will be mailed in time to reach you by Monday, July 13.

Yours very truly,
Watrous H. Irons
President

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

PA YM ENTS TO AND BY T H E SU BSCRIBER IN TH E JU L Y 1964 ADVANCE R E FU N D IN G

Securities To Be Exchanged
1964 Maturities:
5%
Note, 8 /1 5 /6 4
S % % Note, 8 /1 5 /6 4
4y8% Note, 11/15/64
3%.% Note, 11/15/64
1965-67 Maturities:
3% % Note, 5 /1 5 /6 5
3%% Note, 2 /1 5 /6 6
3%% Bond, 5 /1 5/6 6
4%
Note, 8 /1 5 /6 6
3%% Note, 2 /1 5 /6 7
1964 Maturities:
5%
Note, 8 /1 5 /6 4
3%% Note, 8 /15 /6 4
4%% Note, 11/15/64
3%% Note, 11/15/64
1965-67 Maturities:
3%% Note, 5 /1 5/65
3%% Note, 2 /1 5 /6 6
3%% Bond, 5 /1 5/6 6
4%
Note, 8 /1 5 /6 6
3%% Note, 2 /1 5 /6 7

(In Dollars Per $100 Face Value)
Accrued Interest
Amounts To Be Paid To
To July 22,1964
Or By Subscribers
To Be Paid
Price Adjustment
To
By
Payment1
Subscriber
Subscriber
To
By
2
3
Subscriber
Subscriber
For the 4% Bond 1 0 /1 /6 9
.450000
.300000
.800000
.450000
.500000
.100000
.250000
.650000
—

'

.900000
.750000
1.250000
.900000
.950000
.550000
.700000
1.100000
.150000

_
—
—

1.224044
1.224044
1.224044
1.224044

1.396286
.703703
.476771
—

.081109

1.224044
1.224044
1.224044
1.224044
1.224044

.449445
—
1.162220
.049445

.008011
—
.281109
—
—

—
—
—

3.070330
2.377747
2.150815
1.592935

—
—
—

—
—
—

1.666033
2.123489
1.392935
2.836264
1.723489

—
—
—
—

2.170330
1.627747
.900815
.692935

1.844780
1.844780
1.844780
1.844780

.375550
—
—
—

.317033
.543965
1.101845

.716033
1.573489
.692935
1.736264
1.573489

1.844780
1.844780
1.844780
1.844780
1.844780

—
—
.141484
—

1.028747
.571291
1.301845
—
.971291
July 8,1964

2.170330
1.627747
.900815
.692935

.716033
1.573489
.692935
—
1.736264
1.573489
.300000
For the 4(4% Bond 11/15/73

_
_

_
_
—

2.170330
1.627747
.900815
.692935

.716033
1.573489
.692935
—
1.736264
—
1.573489
For the 4'A% Bond 8/15/87-92

_
_

1964 Maturities:
5%
Note, 8 /1 5 /6 4
.050000
—
—
3%% Note, 8 /15 /6 4
.100000
—
4%% Note, 11/15/64
.400000
—
3%% Note, 11/15/64
.050000
1965-67 Maturities:
3%% Note, 5 /1 5/65
.100000
—
3%% Note, 2 /1 5 /6 6
.300000
—
3%% Bond, 5 /1 5/6 6
.150000
—
4%
Note, 8 /1 5 /6 6
.250000
3%% Note, 2 /1 5 /6 7
.700000
—
OFFICE OF THE SECRETARY OF THE TREASURY
OFFICE OF DEBT ANALYSIS
1 Payment on account of purchase price of offered securities.
2 On securities to be exchanged.
3 On securities offered.

Net Amount To Be Paid
To
By
Subscriber
Subscriber

—

—
—

IN V ESTM EN T RETU R N S IN T H E JU LY 1964 ADVANCE REFU N D IN G
Approximate Investment Yield
Approximate Reinvestment Rate
From 7 /2 2 /6 4 to Maturity1
for the Extension Period2
4 '4 % Bond
4 >4% Bond
4% Bond
8/15/87-923 4% Bond
4% % Bond
8/15/87-923
Securities Eligible
1 0 /1 /6 9
4 ^ % Bond To First Call
1 0 /1 /6 9
11/15/73
To
To
for Exchange_______________ 3
11/15/73
or_Maturity_______3____________ 3
First Call
Maturity
1964 Maturities:
4.25%
4.25%
4.24%
4.08%
5%
Note, 8 /15 /6 4
4.22%
4.24%
4.06%
4.25
4.25
4.23
4.07
3% % Note, 8 /15 /6 4
4.06
4.22
4.24
4.26
4.27
4.26
4.22
4.12
4% % Note, 11/15/64
4.06
4.24
4.26
4.26
4.27
4.12
3%% Note, 11/15/64
4.22
4.24
4.06
1965-67 Maturities:
4.28%
4.27%
4.29%
3% % Note, 5 /15 /6 5
4.15%
4.08%
4.23%
4.25%
4.29
4.34
4.30
4.24
4.22
3%% Note, 2 /15 /6 6
4.09
4.25
4.30
4.36
4.30
4.23
3%% Bond, 5/1 5 /6 6
4.08
4.23
4.25
4.30
4.31
4.24
4.36
4%
Note, 8 /1 5/66
4.08
4.23
4.25
4.32
4.31
4.39
4.28
3%% Note, 2/ 15/ 67
4.08
4.23
4.25
OFFICE OF THE SECRETARY OF THE TREASURY
July 8, 1964
OFFICE OF DEBT ANALYSIS
1 Yields to nontaxable holders (or before tax) on issues offered in exchange based on prices of eligible issues (adjusted for
payments on account of issue price). Prices are the mean of bid and ask quotations at noon on July 7, 1964.
2 Rate for nontaxable holders (or before tax).
3 Reopening of an existing security.

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