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FEDERAL RESERVE BANK O F NEW YORK r Circular No. 4 0 5 6 1 L December 30,1953 J Fiscal Agent o f the United States Offering o f $1,500,000,000 o f 91-Day Treasury Bills Dated January 7, 1954 Maturing April 8, 1954 T o a ll I n c o r p o r a t e d B a n k s a n d T r u s t C o m p a n i e s , a n d O t h e r s C o n c e r n e d , in th e S e c o n d F e d e r a l R e s e r v e D i s t r i c t : F ollow in g is the text o f a notice published to d a y : TREASURY DEPARTM ENT W a s h in g to n F O R R E L E A S E , M O R N IN G N E W S P A P E R S , W e d n e s d a y , D e ce m b e r 30, 1953. T h e T re a su ry D ep a rtm en t, b y this p u b lic n otice, invites tenders fo r $1,500,000,000, o r thereabouts, o f 9 1-d ay T rea su ry bills, fo r cash and in e x ch a n g e fo r T rea su ry bills m atu rin g January 7, 1954, in the a m ou n t o f $1,500,820,000, to be issued o n a d iscou n t basis under com p etitiv e and n o n -com p etitiv e b id d in g as h ereinafter provid ed . T h e bills o f this series w ill be dated J anuary 7, 1954, and w ill m ature A p ril 8, 1954, w h en th e fa ce a m ou n t w ill b e p ayable w ith ou t interest. T h e y w ill be issued in bearer fo r m on ly , and in den om in a tion 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 re ce iv e d at F ed era l R eserve B anks and B ra n ch es up to th e clo s in g h our, tw o o ’ c lo c k p.m ., E astern S tandard tim e, M o n d a y , January 4, 1954. T e n d e rs w ill n ot be receiv ed at the T r e a s u ry D ep a rtm en t, W a sh in g to n . E a ch tender m u st be fo r an even m u ltiple o f $1,000, and in the case o f com p etitiv e ten ders the p rice o ffe re d m u st be exp ressed o n the basis o f 100, w ith n ot m o re than three decim als, e. g., 99.925. F ra ction s m a y n ot b e used. It is u rged th at ten ders be m ade o n the printed fo rm s and forw a rd ed in the special en velopes w h ich w ill b e su p plied b y F ed eral R e serv e B a n k s o r B ran ches o n a pp lica tion th erefor. O th ers than b a n k in g institutions w ill n ot b e perm itted to subm it tenders ex cep t fo r th eir ow n a ccou n t. T e n d e rs w ill be receiv ed w ith ou t d ep o sit fr o m in corp ora ted banks and trust com p a n ies and fr o m resp on sib le and r e co g n iz e d dealers in in vest m en t securities. T e n d e rs fro m oth ers m u st be a cco m p a n ie d b y p a y m en t o f 2 p ercen t o f the fa ce a m ou n t o f T r e a s u ry bills a pp lied fo r, unless th e ten ders are a ccom p a n ied b y an exp ress gu a ra n ty o f pa ym en t b y an in co rp o ra te d b a n k o r trust com p a n y . Im m ed ia tely a fter the clo s in g h our, ten ders w ill be o p e n e d at the F ed eral R e serv e B anks and B ra n ch es, fo llo w in g w h ich p u blic an n ou n cem en t w ill be m ade b y the T r e a s u ry D ep a rtm en t o f th e a m ou n t and p rice ra n ge o f a cce p te d b ids. T h o s e su b m ittin g tenders w ill be advised o f the a ccep ta n ce o r rejection th ereof. T h e S ecreta ry o f the T r e a s u ry ex p re s sly reserves the righ t to a c c e p t o r reject a n y o r all tenders, in w h o le o r in part, and his a ction in a n y such resp ect shall be final. S u b je ct to these reservations, n o n -com p etitiv e ten ders fo r $200,000 or less w ith ou t stated p rice fr o m any on e b idd er w ill be a ccep ted in full at the a vera ge p rice (in th ree d ecim a ls) o f a ccep ted co m p e titiv e b ids. S ettlem en t for a ccep ted ten ders in a ccord a n ce w ith the b id s m u st be m a d e o r com p le te d at the F ed eral R eserve B a n k on January 7, 1954, in cash o r o th e r im m ediately available fu n ds o r in a like face a m ou n t o f T rea su ry bills m atu rin g J anu ary 7, 1954. Cash and ex ch a n g e ten ders w ill receive equal treatm ent. Cash adju stm en ts w ill b e m ade fo r d ifferen ces betw een th e par valu e o f m a tu rin g bills a cce p te d in exch a n ge and the issue price o f the n e w bills. T h e in co m e d eriv e d fr o m T r e a s u ry bills, w h eth er in terest or gain fr o m the sale o r oth er d isp osition o f the bills, shall n ot have any exem ption , as such, and lo s s fr o m the sale o r oth er d isp osition o f T r e a s u ry bills shall n ot have a n y sp ecia l treat m en t, as such, u nder th e Internal R even u e C ode, o r law s a m en d a tory o r su p p lem en ta ry th ereto. T h e bills shall be su b je ct to estate, inheritance, g ift, o r oth er e x cis e taxes, w h eth er F ed eral o r S tate, b u t shall be e x e m p t fro m all taxation n o w o r h ere a fter im p osed o n the principal or interest th ereof b y a n y State, or any o f th e p oss e s s io n s o f the U n ited States, o r b y a n y loca l ta x in g authority. F o r pu rp oses o f taxation the a m ou n t o f d iscou n t at w h ich T r e a s u ry bills are orig in a lly s o ld b y th e U n ited States shall be co n sid e red to b e interest. U n d e r S ection s 42 and 117 ( a ) (1 ) o f the Internal R even u e C od e, as a m en d ed b y S ection 115 o f the R even u e A c t o f 1941, th e a m ou n t o f d iscou n t at w h ich bills issued h ereu n der are sold shall n o t be con sid e re d to a ccru e until such bills shall b e sold , red eem ed o r oth erw ise d isp osed o f, and such bills are exclu d ed fr o m con sid era tio n as capital assets. A c c o r d in g ly , th e ow n er o f T r e a s u ry bills (o th e r than life in su rance co m p a n ie s ) issued h ereu n der n eed in clude in his in co m e ta x return o n ly the differen ce b etw een the p rice paid fo r su ch bills, w h eth er o n origin a l issue o r on subsequent pu rch ase, a n d the a m ou n t actu ally receiv ed either u p on sale o r red em p tion at m aturity du rin g the taxable yea r fo r w h ich the return is m ade, as o rd in a ry gain or loss. T re a su ry D e p a rtm e n t C ircu la r N o. 418, as am en ded , and this n otice, prescrib e the term s o f th e T r e a s u ry bills and g o v e rn the co n d itio n s o f their issue. C op ies o f the circu la r m a y be ob ta in ed fro m a n y F ed era l R eserve B a n k o r B ra n ch . T h is Bank w ill receive tenders up to 2 p.m ., Eastern Standard time, M on day, January 4, 1954, at the Securities Departm ent o f its H ead Office and at its B u ffa lo Branch. Please use the fo rm on the reverse side o f this circular to submit a tender, and return it in an envelope marked “ T en d er fo r T reasury Bills.” T en d ers m ay be submitted b y telegraph, sub ject to w ritten con firm ation ; they m ay not be submitted by telephone. Paym ent f o r the Treasury bills cannot be made by credit through the Treasury T ax and Loan Account. Settlement must be made in cash or other immediately available funds or in maturing Treasury bills. A l l a n S p r o u l , President. R e su lts o f la st o ffe rin g o f T r e a s u r y b ills ( 9 1 -d a y bills d a te d D e c e m b e r 3 1 , 1 9 5 3 , m a t u r in g A p r il 1 , 1 9 5 4 ) T o t a l applied fo r . . . $2,334,602,000 T o ta l a ccep ted .........$1,502,170,000 (in clu d es $206,708,000 en tered on a n on -co m p e titiv e basis and a ccep ted in full at the a verage p rice sh ow n b e lo w ) A v e ra g e p rice. . . 9 9 .6 0 2 + E q u iva len t rate o f discou n t app rox. 1.574% per annum R a n g e o f a ccep ted com p etitive b id s: H ig h L ow .................... 99.607 E quivalent rate o f discou n t app rox. 1.555% per annum ...................... 99.601 E quivalent rate o f discou n t a p p rox. 1.578% per annum (82 percent o f the am ount b id fo r at the lo w price was accepted) F ed era l R ese rv e D is tr ic t T o ta l A p p lie d f o r B o s to n ............................. N e w Y o r k ...................... P h iladelphia .................. C levelan d ...................... R ich m o n d ...................... A tla n ta ........................... C h ica g o ........................... St. L ou is ......................... M in neapolis .................. K ansas C ity .................. D allas ............................. San F r a n cis co .............. T ota l ............. $ T o ta l A c cep te d 30,855,000 1,784,842,000 46,405,000 45,756,000 14,320,000 25,961,000 193,888,000 20,999,000 7,825,000 48,549,000 52,802,000 62,400,000 $ 17,539,000 1,098,749,000 25,856,000 45,407,000 13,920,000 18,791,000 121,948,000 20,292,000 7,145,000 40,013,000 44,463,000 48,047,000 $2,334,602,000 $1,502,170,000 ( over) 30 P IMPORTANT — If you desire to bid on a competitive basis, fill in rate per 100 and maturity value in paragraph headed "Competitive Bid.” If you desire to bid on a non-competitive basis, fill in only the maturity value in paragraph headed "Non-competitive Bid.” DO N O T fill in both paragraphs on one form. A separate tender must be used for each bid, except that banks submitting bids on a competitive basis for their own and their customers’ accounts may submit one tender for the total amount bid at each price, provided a list is attached showing the name of each bidder, the amount bid for his account, and method of payment. Forms for this purpose will be furnished upon request. N o ............................... TENDER FOR 9 1-DAY TREASURY BILLS Dated January 7, 1954 To F ed era l R eserve B an k o f N ew Maturing April 8, 1954 Dated at Y ork , Fiscal A gen t o f the U n ited States. 19 COMPETITIVE BID NON-COMPETITIVE BID Pursuant to the p rovisions o f T reasu ry Departm ent C ircular N o. 418, as amended, and to the p rovisions o f the public notice on D ecem ber 30, 1953, as issued b y the T reasu ry Department, Pursuant to the provisions o f T reasu ry Departm ent C ircular N o. 418, as amended, and to the provisions o f the public notice on Decem ber 30, 1953, as issued b y the T reasu ry Department, the undersigned o ffers a non-com petitive tender the undersigned o ff e r s ....................................... * fo r a fo r a total amount o f $ ................................................ (Rate per 100) total amount o f $ ......................................... (m aturity valu e) o f the T reasu ry bills therein described, or fo r an y less am ount that m ay be awarded, settle m ent th erefor to be made at y o u r Bank, on the date stated in the public notice, as indicated b e lo w : □ By surrender of m aturing T reasu ry bills (N ot to exceed $200,000) (m aturity value) o f the T reasu ry bills therein described, at the average price (in three decim als) o f accepted com petitive bids, settlement th erefor to be made at y ou r Bank, on the date stated in the public notice, as indicated b e lo w : □ By surrender of m aturing T reasu ry bills am ounting t o ....................... $________________________ am ounting t o ....................... $ ________________________ □ □ B y cash or other im mediately available funds B y cash o r other immediately available funds * P r i c e m u s t b e e x p r e s s e d o n th e b a s is o f 100, w i t h n o t m o r e th a n t h r e e d e c im a l p l a c e s , f o r e x a m p l e , 99.925. T h e T rea su ry bills fo r which tender is hereby made are to be dated January 7, 1954, and are to mature on A p ril 8, 1954. This tender will be inserted in special envelope marked “ Tender fo r Treasury Bills.” N a m e o f B i d d e r ------ (Please print) B y ........................... ............................ .. (Official signature required) (T itle) S treet A d d re s s ...................................... (C ity, T ow n or V illage, P . O . N o., and State) I f this tender is submitted by a bank for the account o f a customer, indicate the customer’s name on line below: (N am e o f Customer) (C ity, T ow n or Village, P. O. N o., and State) IMPORTANT INSTRUCTIONS: 1. N o ten der fo r less than $1,000 w ill be con sid ered , and each ten d er m u st b e fo r an even m u ltip le o f $1,000 (m a tu rity v a lu e ). 2. I f th e p e r so n m a k in g the ten der is a corp ora tion , th e ten der sh ou ld be sig n ed b y an officer o f th e c o rp o ra tion a u th orized t o m a k e th e tender, and the sig n in g o f the ten der b y an officer o f the corp o ra tio n w ill be co n stru e d as a rep resen ta tion b y h im th at he has b een s o au th orized . If the ten der is m ade b y a partnersh ip, it s h ou ld be sig n e d b y a m e m b e r o f th e firm , w h o sh ou ld sign in the fo rm “ .................................................................................................... , a cop a rtn ersh ip , b y .......................................................................................................................................... a m e m b e r o f th e firm .” 3. T e n d e rs w ill be receiv ed w ith ou t d ep osit fro m in corp ora ted banks and trust com p a n ies and fro m re s p o n sible and re c o g n iz e d dealers in in vestm en t securities. T e n d e rs fr o m oth ers m u st be a cco m p a n ie d b y paym ent o f 2 p ercen t o f th e fa ce a m ou n t o f T r e a s u ry bills applied fo r, unless the ten ders are a cco m p a n ie d b y an exp ress gu a ra n ty o f p a ym en t b y an in co rp o ra te d bank o r trust com p a n y . 4. I f the la n g u a ge o f this ten der is ch a n g ed in a n y respect, w h ich , in th e o p in io n o f the S ecreta ry o f the T r e a s u ry , is m aterial, th e ten der m a y be disreg arded. Payment by credit through Treasury Tax and Loan A ccount wilLnot be permitted. TENTB— 1227-a ( over )