Full text of Federal Reserve Bank of New York Circulars : 4385. Special Cash Offering of $1,750,000,000 of 91-Day Treasury Bills

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FEDERAL RESERVE BANK O F N EW YORK
F iscal A g en t of th e U nited S tates
rC irc u la r N o. 4 3 8 5 * 1
L N ovem ber 8, 1956 J

Special Cash Offering of $ 1 ,750,000,000 of 91-Day Treasury Bills
Dated November 16, 1956

M aturing February 15, 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 today :
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 ,
T hursday, N ovem ber 8, 1956.

TREA SU RY D EPA R TM EN T
W ashington

T he T reasury Departm ent, by this public notice, invites tenders for $1,750,000,000, or thereabouts, of 91-day Treasury
bills, to be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided. The bills of
this series will be dated November 16, 1956, and will m ature F ebruary 15, 1957, when the face am ount will be payable without
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).
Tenders will be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty o’clock p.m.,
E astern Standard time, Tuesday, N ovember 13, 1956. Tenders will not be received a t the T reasury D epartm 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. It is urged th at 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.
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 trust companies and from responsible and recognized dealers in invest­
m ent securities. Tenders 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 without 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 at the Federal Reserve Bank in cash or other immediately available funds on
November 16, 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 custom ers 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 treat­
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 1 :30 p.m., E astern Standard time, Tuesday, November 13, 1956, at the
Securities Department of its H ead 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 m ust 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.
In a statement made public yesterday, the Treasury Departm ent said that the purpose of this special cash offering
is to raise cash for current requirements.




A lfred

H a yes,

President.
( over)

IM PO R TA N T—I f you desire to b id on a com p etitive basis, fill in ra te p e r 100 and m atu rity
value in p aragraph headed “ Com petitive B id.” If you desire to bid on a noncom petitive
basis, fill in only th e m atu rity value in p arag rap h headed “N oncom petitive Bid.” DO
N O T fill in both paragraphs on one form . A separate ten d er m ust b e used for each bid,
except th a t banks subm itting bids on a com petitive basis fo r th eir own and th e ir custom ers’
accounts m ay subm it one ten d er 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 for his account, and method
of paym ent. Form s for this purpose will be furnished upon request.
No.

TENDER FOR 91-DAY TREASURY BILLS
SPEC IA L CASH O FFER IN G
M aturing F eb ru ary 15, 1957
D ated N ovem ber 16, 1956
To

Dated at ............................
F ed era l R eserv e B a n k o f N ew

Y ork,

Fiscal Agent of the U nited States.

1956

C O M PETITIV E BID
P ursuant to the provisions of Treasury
Department Circular No. 418, Revised, and to
the provisions of the public notice on November 8 ,
1956, as issued by the T reasury Department, the

N O N CO M PETITIV E BID
Pursuant to the provisions of T reasury De­
partm ent Circular No. 418, Revised, and to the
provisions of the public notice on November 8 ,
1956, as issued by the Treasury Department,
the undersigned offers a noncompetitive tender

undersigned o f f e r s ............................................. * for
(R a te p er 100)

for a total amount of $ ...............................................
(N o t to exceed $200,000)

a total amount of $ ................................ .................
(m aturity value) of the Treasury bills therein
described, or for any less amount that may be
awarded, 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

(m aturity value) of the Treasury 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 or other immediately 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, fo r example, 99.925.

The T reasury bills for which tender is hereby made are to be dated November 16, 1956, and are to mature
on February 15, 1957.
This tender will be inserted in special envelope marked “Tender for Treasury Bills— Special Cash
O ffering”
Name of Bidder . . . .
By

(P lea se p rin t)

(O fficial signature required)

(T itle)

Street A ddress .....................................
(C ity , T ow n o r V illage, P . O . N o ., an d S ta te )

If this tender is subm itted by a bank for the account of a customer, indicate the custom er’s nam e on line below:
(N a m e of C ustom er)

(C ity , T ow n o r V illage, P . O . N o., and S ta te )

IM PO R T A N T INSTRUCTION S:
1. No tender for less 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 m ake 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, who 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 tru st company.
4. If the language of this tender is changed in any respect, which, in the opinion of the Secretary of the
T reasury, is material, the tender may be disregarded.

T E N T B — SC-2


B e sure to return tender in special envelope m arked
“T ender for Treasury B ills— Special Cash O fferin g ”
(O V E R )

F

ederal

R eserve B a n k

of

N ew Y

ork

NOTICE OF ALLOTMENT
OF U NITED STATES O F AM ERICA TREASURY BILLS
SPECIA L CASH O FFERIN G
November 14, 1956.

Your Q competitive Q noncom petitive tender for T reasury bills (Special Cash
O ffering), dated November 16, 1956, m aturing F eb ru ary 15, 1957, has been accepted at the
rate of
(per 1 0 0 ), in the am ount of $
(m atu rity value).
Settlem ent therefor m ust be made in cash or other im mediately available funds a t the
F ederal Reserve B ank of New Y ork on or before November 16, 1956, except th a t a qualified
depositary m ay make settlem ent by credit to T reasury Tax and Loan Account.
To obtain delivery of the T reasury bills, please complete both copies of the attached L etter
of Instructions, and re tu rn them prom ptly to the F ederal Reserve B ank of New York. I f
settlem ent is to be made by check on a bank other th an the F ederal Reserve B ank of New York,
the check should be received by us in time fo r collection on date bills are issued, otherwise it
will be necessary fo r the bidder to p ay fo r the bills allotted a t the price computed on the ra te of
discount on such bills to the date of collection. I f settlem ent is to be made by credit to T reasury
Tax an d Loan Account, the Certificate of Deposit, which is p a rt of the attached form, m ust be
executed and officially signed.

F ederal R eserv e B a n k

of

N ew

Y ork

Fiscal A gent of the U nited States.
Checked by




'H IS L E T T E R OP INSTRUCTIONS (ACCOMPANIED BY ATTACHED DUPLICATE YELLOW COPY) TO BE
P IL L E D IN AND RETURNED TO FE D E R A L RESERV E BANK OF NEW YORK
STB
To

LETTER OF INSTRUCTIONS

F ed e r a l R eserve B a n k o p N e w Y o rk ,

Fiscal Agent of the United States,
Government Bond Division,
New York 45, N. Y.
From
(D ate)

Referring to our Q competitive □ noncompetitive tender for Treasury bills (Special Cash
Offering), dated November 16, 1956, m aturing February 15, 1957, which has been accepted at the
rate of
(per 1 0 0 ), in the amount of $
(m aturity value),
please issue and make delivery of the bills as instructed below.
Settlement will be made as indicated below:
By cash

$............................

By check in funds available on issue date

$............................

By charge to our reserve account, which you are authorized to make . . .

$............................

By credit to Treasury Tax and Loan Account on our books as indicated
on the attached Certificate of Deposit which we have officially executed..

$.

Issue bills in the
following denominations
Pieces

Denomination
$
1,000

(Please do not use this space)

Maturity value

Dispose of bills as indicated below

Numbers

□
0
□

5,000
10,000

□

100,000

□

500,000

1. Deliver over the counter to the
undersigned
2. Ship to the undersigned
3. Hold in safekeeping (for member
bank only)
4. Hold as collateral for Treasury Tax
aud Loan Account
5. Special instructions:

1,000,000
Totala-----

IM P O R T A N T : No changes in delivery instructions will be accepted.
T h e u n d e r s ig n e d ( i f a b a n k or tr u st c o m p a n y ) h e r e b y c e r tifie s t h a t th e T r e a su r y b ills w h ic h y o u a re h e r e b y in str u c te d to
d is p o s e o f in th e m a n n e r in d ic a te d in ite m 3 or 4 a b o v e a r e th e s o le p r o p e r ty o f th e u n d e r sig n e d .

(Pill in all required spaces before signing)
Name of subscriber
(Please print)

B y ...............................

....................., B y .................
(Official signature required)

Title

Title ........................
Address

( S p a c e s b e lo w a r e fo r th e u s e o f F e d e r a l R e s e r v e B an k o f N e w Y o r k )

Government Bond Division

Security Custody Department

Safekeeping Division

Puymeut received
lig u e d :

Deliver against payment

Takeu from vault

Checked .

Counted ..............

Delivered

of $ .................................
Checked ..............

signed:

D E L IV E R Y R E C E IP T

Received from Federal Reserve Bank of New York, Fiscal Agent of the United States, the above described Treasury bills allotted in the amount
indicated above.
Subscriber.....................................................................................................

D a te .

B y.

If paym ent is to be m ade by credit to T reasury T ax and Loan Account, the following Certificate of Deposit should
be officially executed.

GOVERNMENT BOND DIVISION

( T h i s c e r t if ic a te m u st b e e x e c u t e d w h e n su b s c r ib e r is m a k in g p a y m e n t th r o u g h T r e a su r y T a x an d L oan A c c o u n t .)

C e rtific a te o f D e p o s it in T r e a s u r y T a x a n d L o a n A c c o u n t

The undersigned depositary certifies that it will deposit on November 16, 1956. to the
credit of Federal Reserve Bank of New York, Fiscal Agent of the United States, in the
Treasury Tax and Loan Account, to be held subject to withdrawal on demand the above sum
in payment of $
(m aturity value) T reasury bills dated November 16, 1956, due February 15, 1957,
allotted as per Notice of Allotment dated November 14, 1956.

D ated



(N am e of depositary)

B y ......................

(Official signature required)

Street address

(C ity, Tow n o r Village, P. O. No., and State)

(T itle)

(D U P L IC A T E F O R U S E O F F E D E R A L

ST B

______

RESER V E BANK O F N EW YORK)

LETTER OF INSTRUCTIONS

I
To F e d e r a l R e se r v e B a n k op N e w Y o rk ,

i

Fiscal Agent of the U nited States,
Government Bond Division,
New York 45, N. Y.
From

................................................
(D ate)

R eferrin g to our □ competitive Q noncom petitive tender for T reasury bills (Special Cash
O ffering), dated November 16, 1956, m aturing F eb ru a ry 15, 1957, which has been accepted a t the
rate of
(per 1 0 0 ), in the am ount of $
(m aturity value),
please issue and make delivery of the bills as instructed below.
Settlem ent will be made as indicated below :
By cash

$.............................

By check in funds available on issue date

$.............................

By charge to our reserve account, which you are authorized to make . . .

$.............................

By credit to T reasury Tax and Loan A ccount on our books as indicated
on the attached Certificate of Deposit which we have officially e x e c u te d ..

$ .............................

Issue bills in the
following denominations
Pieces

Denomination
$
1,000

Dispose of bills as indicated below

(Please do not use this space)
Numbers

M aturity value

0
□
0

5,000
10,000

0

100,000

0

500,000

1. Deliver over the counter to the
undersigned
2. Ship to the undersigned
3. Hold in safekeeping (for member
bank only)
4. Hold as collateral for Treasury Tax
and Loan Account
5. Special instructions:

1,000,000
Totals------

IM P O R T A N T : N o changes in delivery instructions will b e accepted.
T h e u n d e r s ig n e d ( i f a b a n k or tr u s t c o m p a n y ) h e r e b y c e r t if ie s t h a t t h e T r e a s u r y b ills w h ic h y o u a r e h e r e b y in s t r u c t e d t o
d is p o s e o f in th e m a n n e r in d ic a t e d in ite m 3 o r 4 a b o v e a r e th e s o le p r o p e r t y o f t h e u n d e r s ig n e d .

(Fill in all required spaces before signing)
N am e o f subscriber
(Please print)

..........

B y ........................

By . . . . . . .

(Official signature required)

T itle

T itle ............................
A ddress

( S p a c e s b e lo w a r e f o r t h e u s e o f F e d e r a l R e s e r v e B a n k o f N e w Y o r k )

Safekeeping Division

Security Custody Department

Government Bond Division
P a y m en t received
s ig n e d :
Deliver a g a in s t p ay m en t

Taken fro m vault

Checked

Counted

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

D elivered

Cheeked

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

,

of $ .......................................
s ig n e d :

DELIVERY RECEIPT
Received from Federal Reserve Bank of New York, Fiscal Agent of the United States, the above described Treasury bills allotted in the amount
indicated above.
D a te .

Subscriber.........................................................................................................




B y.

4
F

STR

ederal

R eserv e B a n k

N ew Y

op

ork

PENDING DELIVERY TICKET
OF U NITED STATES O F AM ERICA TREASURY BILLS
SPECIAL CASH O FFERIN G
November 14, 1956.

Your Q competitive □ noncom petitive tender for T reasury bills (Special Cash
O ffering), dated November 16, 1956, m aturing F eb ru ary 15, 1957, has been accepted a t the
rate of
(per 1 0 0 ), in the am ount of $
(m atu rity value).

C O M P U T A T IO N O F COST
PAR

P A Y M E N T A N D D IS P O S IT IO N
R E S E R V E A C C T .........................C H

C H E C K ........................................... □
D EL. TE LL E R

CU

SCOUNT

S A FE K E E P IN G ...........................C U
S H IP ................................................□
IN C IP A L




A. D. T R A N S F E R ......................E l ]

M A ST E R

F

STB

ederal

R eserv e B

ank op

N e w Y ork

FILLED ALLOTMENT DELIVERY TICKET
OF U N ITED STATES OF AMERICA TREASURY BILLS
SPECIAL CASH O FFERIN G
November 14, 1956.

Y our Q competitive □ noncom petitive tender for T reasury bills (Special Cash
O ffering), dated November 16, 1956, m atu rin g F eb ru a ry 15, 1957, has been accepted a t the
rate of
(p e r 100), in th e am ount of $
(m atu rity value).




g

j g

SECURITIES DEPARTMENT COPY
SPECIAL CASH O FFER IN G
November 1'

1956.

Y our □ competitive [[] noncom petitive tender for T reasury bills (Special Cash
O ffering), dated November 16, 1956, m atu rin g F eb ru ary 15, 1957, has been accepted a t the
rate of
(p e r 100), in th e am ount of $
(m atu rity value).




RECORDS STORAGE O FFIC E, ITHACA, N. Y.
F ed era l R eserv e B a n k

of

N e w Y or k

NOTICE OF ALLOTMENT
O F U N ITED STATES O F AM ERICA TREASURY BILLS
SPECIAL CASH O FFER IN G
November 14, 1956.

Your Q competitive Q noncom petitive tender for T reasury bills (Special Cash
O ffering), dated November 16, 1956, m atu rin g F eb ru ary 15, 1957, has been accepted a t the
ra te of
(p e r 100), in the am ount of $
(m atu rity value).