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F E D E R A L R E S E R V E BA N K O F N E W YORK Fiscal Agent of the United States f C ircu lar N o . 4 7 5 4 T I J u ly 2 .1 9 5 9 J OFFERING OF TW O SERIES OF TREASURY BILLS 81,200,000,000 of 91-Day Bills, Additional Amount, Series Dated April 9, 1959, Due October 8, 1959 (To Be Issued July 9, 1959) $400,000,000 of 182-Day Bills, Dated July 9, 1959, Due January 7, 1960 To All Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve District: Following is the text o f a notice issued by the Treasury Department, released for publication in morning newspapers, Thursday, July 2, 1959: T h e T re a su ry D epartm en t, b y this p u b lic n otice, invites tenders fo r tw o series o f T rea su ry bills to the a g g reg a te am ount o f $1,600,000,000, o r th erea b ou ts, fo r cash and in e x ch a n g e fo r T re a su ry bills m aturing J u ly 9, 1959, in the a m ou n t o f $1,600,093,000, as fo llo w s : 91-day bills ( t o m atu rity da te) t o be issued July 9, 1959, in tiie a m ou n t o f $1,200,000,000, o r th ereabouts, represen t in g an additional am ou nt o f bills dated A p ril 9, 1959, and to m ature O c to b e r 8, 1959, orig in a lly issued in the a m ou n t o f $400,047,000, the additional and original bills to be fre e ly in terch angeable. 182-day bills, fo r $400,000,000, o r th erea b ou ts, to be dated July 9, 1959, and to m ature January 7, 1960. 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 com p etitiv e b id d in g as h ereinafter p r o vided, and at m aturity th eir fa ce a m ou n t w ill b e p ayable w ithout interest. T h e y w ill be issued in bearer fo r m on 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 v a lu e ). T e n d e rs w ill be received at F ed eral R e serv e Banks and B ran ches up to th e clo s in g h our, on e-th irty o ’ c lo ck p.m ., Eastern D a y lig h t S a vin g tim e, M on d a y , July 6, 1959. T en d ers will not be re ce iv e d at the T re a su ry D epartm en t, W a s h in g to n . E ach ten der m u st be fo r an even m u ltiple o f $1,000, and in the ca se o f co m p e titiv e tenders the price o ffe re d m u st be exp ressed on the basis o f 100, w ith n o t m o r e than th ree decim a ls, e.g., 99.925. F ra ctio n s m ay n ot be used. It is u rg ed that ten d ers b e m ade on the printed fo rm s and fo rw a rd e d in th e sp ecia l en v elop es w hich w ill be sup plied b y F ed era l R eserve B anks o r B ra n ch es on app lica tion th erefor. O th ers than banking in stitu tions w ill n ot be perm itted to subm it ten ders excep t fo r their o w n a ccou nt. T en d ers w ill be received w ith ou t dep osit fr o m in corp ora ted banks and trust c o m panies and fro m respon sib le and recog n ized dealers in investm ent securities. T e n d e rs fro m oth ers m ust be a ccom p a n ied b y pa y m ent o f 2 p ercen t o f the fa ce a m ou n t o f T rea su ry bills applied for, unless the tenders are a ccom p a n ied b y an exp ress guaranty o f paym ent b y an in corp ora ted bank o r trust com p a n y . Im m ed ia tely a fter the clo s in g h our, tenders w ill be op en ed ai the F ed eral R eserve B anks and B ran ches, fo llo w in g w h ich public a nn oun cem ent w ill be m ade b y th e T r e a s u ry D epartm en t o f the am ou nt and price ran ge o f a ccep ted bids. T h o s e subm itting tenders w ill be advised o f the a ccep ta n ce o r re je ctio n thereof. 1 he S ecreta ry o f the T reasu ry e x p ressly reserves the righ t to a cce p t o r re je ct any o r all tenders, in w h ole o r in part, and his action in a n y such resp ect shall be final. S u b ject to th ese reserva tion s, n o n co m p e titiv e ten ders f o r $200,000 o r less fo r th e a d d i tional bills dated A p r il 9, 1959, (91 days rem ain in g until m atur ity date on O c to b e r 8, 1959) and n on com p etitiv e ten ders fo r $100,000 o r less f o r th e 182-day bills w ith ou t stated p rice from an y o n e b id d er w ill b e 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 titiv e bids fo r the respective issues. S ettlem en t fo r a ccep ted ten ders in a cco rd a n ce w ith the bids m u st be m ade o r co m p le te d at th e Federal R eserve Bank on July 9, 1959, in cash o r oth er im m ediately available funds or in a like face am ou nt o f T rea su ry bills m atu rin g July 9, 1959. Cash and e x ch a n g e tenders w ill receiv e equal treatm ent. Cash a d ju stm en ts w ill be m a d e f o r d ifferen ces betw een the par value o f m a tu rin g bills a ccep ted in e x ch a n g e and the issue price o f the n ew bills. T h e in com e derived fr o m T rea su ry bills, w h eth er interest or gain fr o m the sale o r oth er d isp osition o f the bills, d oes n ot have any exem p tion , as such, and lo s s fro m the sale o r oth er disp osi tion o f T rea su ry bills d oes n ot have any special treatm ent, as such, under the Internal 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 e x cis e taxes, w hether Federal o r State, but are exem p t fro m all taxation n ow o r h ere after im p osed on the principal or in terest th ereof b y any State, o r any o f the p ossession s o f the U nited States, o r by any local taxing authority. F o r pu rposes o f ta xation the am ou nt o f dis cou nt at w hich T rea su ry bills are o rigin a lly sold b y the U nited States is con sid ered to be interest. U n der S ection s 4 5 4 (b ) and 1221(5) o f the Internal R even u e C od e o f 1954 the a m ou n t o f dis cou nt at w h ich bills issued hereun der are sold is n ot con sidered to a ccru e until such bills are sold, redeem ed o r oth erw ise dis posed of, and such bills are exclu d ed from con sideration as capital assets. A c co r d in g ly , the o w n e r o f T reasu ry bills (o th e r than life insurance com p a n ies) issued hereun der need in clude in his in com e tax return on ly the differen ce betw een the price paid for such bills, w h eth er on original issue o r on subsequent pu r chase, and the a m ou n t actu ally received either upon sale or redem ption at m aturity d u rin g the taxable year for w hich the return is m ade, as ord in a ry gain o r loss. T rea su ry D epartm en t C ircu lar N o. 418, R evised , and this notice, prescrib e the term s o f the T rea su ry bills and g o v e rn the co n d itio n s o f their issue. C op ies o f th e circu la r m ay be obtained fro m a n y Federal R es e rv e B ank o r Branch. This Bank will receive tenders for both series up to 1 :30 p.m., Eastern Daylight Saving time, Monday, July 6, 1959. at the Securities Department o f its Head Office and at its Buffalo Branch. Tender form s for 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 fo r the Treasury bills cannot be made by credit through the Treasury Tax and Loan Account. Settlement must be made in cash or other immediately az’ailable funds or in maturing Treasury bills. Results of the last offering of Treasury bills (91-dav bills to be issued July 2. 1959. representing an additional amount of bills dated April 2, 1959, and maturing October 1. 1959; and 182-day bills dated July 2, 1959, maturing December 31, 1959) are shown on the reverse side of this circular. A lfred H a y e s , President. (o v e r ) RESULTS OF LAST OFFERING OF TREASURY BILLS (TW O SERIES ISSUED JULY 2, 1959) Range of Accepted Competitive Bids 91-Day Treasury Bills Maturing O ctober 1,1959 182-Day Treasury Bills Maturing D ecem ber 31,1959 Price A pprox. equiv. annual rate High .................................. 99.210 3.125% 98.188 3.584% L ow .................................. 99.188 3.212% 98.114 3.731% Average ............................ 99.200 3.164% 98.128 3.703% (48 percent o f the amount o f 91-day bills bid for at the low price was accepted.) Price A pprox. equiv. annual rate (57 percent o f the amount o f 182-day bills bid fo r at the low price was accepted.) Total Tenders Applied for and Accepted (By Federal Reserve Districts) 91-Day Treasury Bills Maturing O ctober 1,1959 Applied for District Boston ............................ Philadelphia 25,573,000 Accepted $ 15,573,000 Applied for $ 3,475,000 Accepted $ 3,475,000 1,376,857,000 726,217,000 706,008,000 363,708,000 ................. 26,218,000 11,218,000 8,807,000 3,807,000 ..................... 41,149,000 41,149,000 21,100,000 21,100,000 7,588,000 New Y ork ..................... Cleveland $ 182-Day Treasury Bills Maturing D ecem ber 31,1959 ..................... 7,588,000 594,000 594,000 Atlanta ......................... 14,482,000 14,482,000 3,625,000 3,625,000 Chicago .......................... 197,318,000 156,318,000 88,176,000 62,746,000 St. Louis ....................... 20,211,000 20,211,000 2,029,000 2,029,000 M in n ea p olis................... 9,063,000 9,063,000 1,372,000 1,372,000 22,186,000 20,136,000 5,968,000 5,368,000 ............................ 12,864,000 12,864,000 2,248,000 2,248,000 San Francisco ............... 65,206,000 65,206,000 49,233,000 29,933,000 Richmond Kansas City Dallas ................. . . Totals ........... $1,818,715,000 $1,100,025,0003 a Includes $182,509,000 noncompetitive tenders accepted at the average price o f 99.200. b Includes $33,3% ,000 noncompetitive tenders accepted at the average price of 98.128. $892,635,000 $500,005,000b