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FEDERAL RESERVE BANK O F NEW YORK Fiscal A g en t of the United States r C ircular No. 4 3 7 5 "1 L O ctober 8, 1956 J Special Cash Offering of $ 1 ,6 0 0 ,0 0 0 ,0 0 0 of 9 1 -Day Treasury Bills Dated October 17, 1956 Maturing January 16, 1957 To all Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve District: Following is the text of a notice published to d ay : 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 , Monday, O ctober 8, 1956. TREA SU RY D E PA R T M E N T W ashington T he T reasury D epartm ent, by this public notice, invites tenders for $1,600,000,000, or thereabouts, of 91-day T reasury bills, to be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided. T he bills of this series will be dated O ctober 17, 1956, and will m ature Jan u ary 16, 1957, when the face am ount will be payable w ithout interest. They will be issued in bearer form only, and in denominations of $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000,000 (m aturity value). T enders will be received at Federal Reserve Banks and Branches up to the closing hour, two o’clock p.m., Eastern D aylight Saving time, W ednesday, O ctober 10, 1956. T enders will not be received at the T reasury Departm ent, W ashington. Each tender m ust be for an even multiple of $1,000, and in the case of competitive tenders the price offered m ust be expressed on the basis of 100, with not m ore than three decimals, e.g., 99.925. Fractions may not be used. I t is urged th at tenders be made on the printed forms and forw arded in the special envelopes which will be supplied by Federal Reserve Banks or Branches on application therefor. O thers than banking institutions will not be perm itted to submit tenders except for their own account. T enders will be received w ithout deposit from incorporated banks and tru st companies and from responsible and recognized dealers in invest ment securities. T enders from others m ust be accompanied by paym ent of 2 percent of the face am ount of T reasury bills applied for, unless the tenders are accompanied by an express guaranty of paym ent by an incorporated bank or tru st company. Im m ediately after the closing hour, tenders will be opened at the Federal Reserve Banks and Branches, following which public announcem ent will be made by the T reasury D epartm ent of the am ount and price range of accepted bids. Those subm itting tenders will be advised of the acceptance or rejection thereof. The Secretary of the T reasury 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 w ithout stated price from any one bidder will be accepted in full at the average price (in three decimals) of accepted competitive bids. Paym ent of accepted tenders at the prices offered m ust be made or completed a t the Federal Reserve Bank in cash or other immediately available funds on O ctober 17, 1956, provided, however, any qualified depositary will be perm itted to make paym ent by credit in its T reasury T ax and Loan A ccount for T reasury bills allotted to it for itself and its customers up to any am ount for which it shall be qualified in excess of existing deposits when so notified by the Federal Reserve Bank of its district. T he income derived from T reasury bills, w hether 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 T reasury bills does not have any special trea t ment, as such, under the Internal Revenue Code of 1954. T h e bills are subject to estate, inheritance, gift or other excise taxes, w hether Federal or State, but are exem pt from all taxation now or hereafter imposed on the principal or interest thereof by any State, or any of the possessions of the U nited States, or by any local taxing authority. F or purposes of taxation the am ount of discount a t which T reasury bills are originally sold by the U nited States is considered to be interest. U nder Sections 454(b) and 1221(5) of the Internal Revenue Code of 1954 the am ount of 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 T reasury bills (other than life insurance companies) issued hereunder need include in his income tax return only the difference between the price paid for such bills, w hether on original issue or on subsequent purchase, and the am ount actually received either upon sale or redemption at m aturity during the taxable year for which the return is made, as ordinary gain or loss. T reasury D epartm ent Circular No. 418, Revised, and this notice, prescribe the term s of the T reasury bills and govern the conditions of their issue. Copies of the circular may be obtained from any Federal Reserve Bank or Branch. This Bank will receive tenders up to 2 p.m., Eastern Daylight Saving time, W ednesday, October 10, 1956, at the Securities Department of its Head Office and at its Buffalo Branch. Please use the form on the reverse side of this circular to submit a tender, and return it in an envelope marked “Tender for Treasury Bills— Special Cash Offering.” Tenders may be submitted by telegraph, subject to written confirmation; they may not be submitted by telephone. Settlem ent for accepted tenders must be made in cash or other immediately available funds, except that any qualified depositary may make payment by credit in its Treasury T a x and Loan Account for Treasury bills allotted to it for itself and its customers, up to any amount for which it shall be qualified in excess of existing deposits. A lfred H ayes, President. (o v z r ) IM PO RTA N T—If you desire to bid on a com petitive basis, fill in rate p e r 100 and m aturity value in p arag rap h headed “ C om petitive B id.” If you desire to b id on a noncom petitive basis, fill in only th e m atu rity value in p arag ra p h headed “N oncom petitive B id.” DO N O T fill in both paragraphs on one form . A separate tender m ust be used fo r each bid, except th a t banks subm itting bids on a com petitive basis for th e ir own and th e ir custom ers’ accounts m ay subm it one tender for th e total am ount bid at each price, provided a list is attached showing th e nam e of each bidder, the am ount bid fo r his account, and m ethod of paym ent. Form s fo r this purpose will be furnished upon request. No. TENDER FOR 91-DAY TREASURY BILLS SPECIA L CASH O FFER IN G M aturing Jan u a ry 16, 1957 D ated O ctober 17, 1956 Dated at T o F ederal R eserve B a n k of N ew Y ork , Fiscal A g en t of the U n ited States. 1956 C O M PETITIV E BID N O N CO M PETITIV E BID P u rsu a n t to the provisions of T reasury D epartm ent C ircular N o. 418, Revised, and to the provisions of the public notice on O ctober 8 , 1956, as issued by the T re a su ry D epartm ent, the Pursuant to the provisions of T reasury De partm ent Circular No. 418, Revised, and to the provisions of the public notice on October 8 , 1956, as issued by the T reasury Department, the undersigned offers a noncompetitive tender undersigned o f f e r s ................................................. * for (R a te p e r 100) for a total amount of $ .................................................. a total am ount of $ ........................................................... (m a tu rity v alu e) of the T reasu ry bills therein described, o r for any less am ount th a t m ay be aw arded, settlem ent th erefo r to be m ade at your Bank, on the date stated in the public notice, as indicated b elo w : (N o t to exceed $200,000) □ By credit to T re a su ry T a x and L oan A ccount (m aturity value) of the T reasury bills therein described, at the average price (in three decimals) of accepted competitive bids, settlement therefor to be made at your Bank, on the date stated in the public notice, as indicated below: □ By credit to T reasury T ax and Loan Account □ By cash o r other im m ediately available funds □ By cash or other immediately available funds * Price must be expressed on the basis of 100, "with not more than three decimal places, for example, 99.925. The T reasury bills for which tender is hereby made are to be dated October 17, 1956, and are to mature on January 16, 1957. This tender will be inserted in special envelope marked “Tender for Treasury Bills— Special Cash O ffering” Name of Bidder ............................................................................................................................. (P lease p rin t) B y ........ (O fficial signature required) (T itle ) S treet A ddress ..................................... (C ity , T ow n o r V illage, P . O . N o., a n d S ta te ) If this tender is subm itted by a bank for the account of a custom er, indicate the custom er’s nam e on line below: (N a m e o f C ustom er) (C ity , Tow n o r V illage, P . O . N o., an d S ta te ) IM PO R TA N T INSTRUCTION S: 1. No tender for Jess than $1,000 will be considered, and each tender m ust be for an even multiple of $1,000 (m aturity value). 2. If the person making the tender is a corporation, the tender should be signed by an officer of the corporation authorized to make the tender, and the signing of the tender by an officer of the corporation will be construed as a rep resentation by him th at he has been so authorized. If the tender is made by a partnership, it should be signed by a mem ber of the firm, w ho should sign in the form “ ................................................................................................. . a copartnership, by ......................................................................................................... . a member of the firm.” 3. T enders will be received w ithout deposit from incorporated banks and tru st companies and from respon sible and recognized dealers in investm ent securities. T enders from others m ust be accompanied by paym ent of 2 percent of the face am ount of T reasury bills applied for, unless the tenders are accompanied by an express guaranty of paym ent by an incorporated bank or trust company. 4. If the language of this tender is changed in any respect, which, in the opinion of the Secretary of the Treasury, is material, the tender may be disregarded. T E N T B — S C -l B e sure to return tender in special envelope m arked “T ender for Treasury B ills— Special Cash Offering.” (OVER)
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