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F E D E R A L R E S E R V E BANK O F N EW YORK [S&bruaryi74i95®] Fiscal Agent of the United States OFFERING OF TW O SERIES OF TREASURY BILLS $1,400,000,000 of 91-Day Bills, Dated February 26, 1959, Maturing May 28, 1959 §400,000,000 of 182-Day Bills, Dated February 26, 1959, Maturing August 27, 1959 7 o all In corporated Banks and T ru st Com panies, and O th ers C oncerned, in the Second Federal R eserv e D istrict: Following is the text o f a notice issued by the Treasury Department, released for publication in morning newspapers, Tuesday, February 17, 1959: T h e T r e a s u ry D epa rtm en t, b y this p u b lic n otice, invites ten ders fo r tw o series o f T r e a s u ry bills to the a g g reg a te am ou nt o f $1,800,000,000, o r th ereabouts, fo r cash and in ex ch a n g e fo r T r e a s u ry bills m atu rin g F eb ru a ry 26, 1959, in the a m ou n t o f $1,802,782,000, as fo llo w s : 9 1-d ay bills, fo r $1,400,000,000, o r th ereabouts, to be dated F eb ru a ry 26, 1959, and to m ature M a y 28, 1959. 182-day bills, fo r $400,000,000, o r th ereabouts, to be dated F eb ru a ry 26, 1959, and to m ature A u g u st 27, 1959. T h e bills o f b o th series w ill be issued on a d iscou n t basis under co m p e titiv e and n o n co m p etitive b id d in g as h erein a fter p r o vided, and at m atu rity th eir fa ce a m ou n t w ill b e p ayable w ith ou t in terest. T h e y w ill be issued in bearer fo r m o n ly , and in d e n om in ation s o f $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000,000 (m a tu rity va lu e). T e n d e rs w ill be receiv ed at F ed eral R e serv e B anks and B ra n ch es up to th e clo s in g h our, on e-th irty o ’c lo ck p.m ., E astern Standard tim e, F rida y, F eb ru a ry 20, 1959. T en d ers w ill n ot be receiv ed at the T re a su ry D epa rtm en t, W a s h in g to n . E a ch ten der m u st be f o r an even m ultiple o f $1,000, and in th e case o f c o m petitive ten ders the p rice o ffered m u st be exp ressed on the basis o f 100, w ith n ot m ore than th ree decim als, e.g., 99.925. F raction s m a y n o t be used. It is u rged that ten ders be m ade on th e printed fo rm s and fo rw a rd e d in the special en v elop es w h ich w ill be su p plied b y F ed era l R e se rv e B anks or B ran ch es on application th erefor. O th e rs than ban k in g in stitu tions w ill n o t be perm itted to subm it ten ders e x ce p t fo r th eir o w n a ccou n t. T e n d e rs w ill be receiv ed w ith ou t dep osit fr o m in co rp o ra te d banks and trust c o m pan ies and fr o m respon sib le and re co g n iz e d dealers in in vestm ent securities. T e n d e rs fr o m oth ers m u st b e a ccom p a n ied b y p a y m en t o f 2 p ercen t o f th e fa ce a m ou n t o f T rea su ry bills applied fo r, unless the ten ders are a ccom p a n ied b y an exp ress gu aranty o f paym ent b y an in co rp o ra ted ba n k o r trust com p a n y . Im m ed ia tely after the c lo s in g h our, ten ders w ill be op en ed at the F ed era l R e se rve B anks a n d B ra n ch es, fo llo w in g w h ich public a n n o u n ce m e n t w ill be m ade b y th e T r e a s u ry D epa rtm en t o f the a m ou n t and price ran ge o f a ccep ted bids. T h o s e subm itting ten ders w ill be advised o f the a ccep ta n ce o r reje ctio n th ereof. T h e S ecreta ry o f the T rea su ry ex p ressly reserves th e righ t to a cce p t o r re je ct a n y o r all ten ders, 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 ject to th ese reserva tions, n on com p etitive ten ders f o r $200,000 o r less fo r the 91-day bills and n on com p etitiv e ten ders fo r $50,000 o r less f o r the 182-day bills w ith ou t stated p rice fr o m any on e b idd er w ill be a cce p te d in full at the a vera ge price (in three d ecim a ls) o f a ccep ted co m p e ti tive bids fo r the resp ective issues. S ettlem en t fo r a ccep ted tenders in a ccord a n ce w ith the b id s m u st be m ade o r com p le te d at the Federal R eserve Bank on F eb ru a ry 26, 1959, in cash o r oth er im m ediately available fu n d s o r in a like face a m ou n t o f T re a su ry bills m a tu rin g F eb ru a ry 26, 1959. Cash and ex ch a n g e tenders w ill receive equal treatm ent. Cash adju stm en ts w ill b e m ade fo r dif feren ces betw een the pa r valu e o f m a tu rin g bills a ccep ted in e x ch a n ge and the issue price o f th e n ew bills. T h e in com e derived fr o m T rea su ry bills, w h eth er interest o r gain fr o m the sale o r oth er d isp osition o f the bills, d oes n o t have a n y exem ption , as such, and loss fr o m th e sale or oth er d isp osi tion o f T r e a s u ry bills d oes n ot have a n y special treatm en t, as such, u nder the In tern al R even u e C o d e o f 1954. T h e bills are su b ject to estate, inheritance, g ift o r o th e r excise taxes, w hether F ed era l o r State, but are exem p t fr o m all taxation n o w o r h ere after im p osed on the principal o r in terest th ereof b y any State, o r a n y o f the p ossession s o f the U n ited States, o r b y any 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 is cou n t at w h ich T rea su ry bills are orig in a lly sold b y th e U nited States is con sid ered to be interest. U n d er S ection s 4 5 4 (b ) and 1221(5) o f the In tern al R even u e C od e o f 1954 the a m ou n t o f d is co u n t at w h ich bills issued h ereun der are sold is n ot con sid ered to a ccru e until such bills are so ld , red eem ed o r oth erw ise dis p o s e d o f, and such bills are ex clu d ed fr o m con sidera tion as capital assets. A c c o r d in g ly , th e o w n e r 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 ereun der need in clude in his in com e tax return o n ly th e differen ce betw een the price paid f o r such b ills, w h e th e r on origin a l issue o r o n subsequen t pu r chase, and th e a m ou n t actu a lly receiv ed either u pon sale o r red em p tion at m atu rity d u rin g the taxable yea r fo r w hich the return is m ade, as ord in a ry ga in o r loss. T rea su ry D ep a rtm en t C ircu la r N o . 418, R ev ised , and this n otice, p rescrib 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 th eir issue. C op ies o f th e circu la r m ay be obtain ed fr o m a n y F ed eral R e s e rv e B a n k o r B ranch. This Bank will receive tenders fo r both series up to 1 :30 p.m., Eastern Standard time, Friday, February 20, 1959, at the Securities Department o f its Head Office and at its Buffalo Branch. Tender form s fo r the respective series are enclosed. Please use the appropriate form s to submit tenders and return them in an envelope marked “ Tender for Treasury Bills.” Tenders may be submitted by telegraph, subject to written confirmation; they may not be submitted by telephone. Payment for the Treasury bills cannot be made by credit through the Treasury Tax and Loan Account. Settlement must be made in cash or other immediately available funds or in maturing Treasury bills. This circular was printed before the results o f the bidding for Treasury bills dated February 19, 1959 were avail able; those results will be announced after release by the Treasury Department. A lfred H a y e s , President. Closing date for receipt o f tenders is Friday , February 2 0 .
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