The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
FEDERAL RESERVE BANK OF N E W YORK Fiscal Agent o f the United States C i r c u la r L N o. 4 9 2 7 August 17, liMK) J OFFERING OF TWO SERIES OF TREASURY BILLS $1,100,000,000 o f 92-Day Bills, Additional Amount, Series Dated May 26, 1960, Due Nov. 25, 1960 (To Be Issued August 25, 1960) $500,000,000 o f 182-Day Bills, Dated August 25, 1960, Due February 23, 1961 To A ll Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve District: F ollow in g is the text o f a notice issued by the Treasury 4 p.m ., Eastern Daylight Saving tim e : The Treasury Department, by this public notice, invites tenders for two series of Treasury bills to the aggregate amount of $1,600,000,000, or thereabouts, for cash and in exchange for Treasury bills maturing August 25, 1960, in the amount of $1,600,116,000, as follows: 92-day bills (to maturity date) to be issued August 25, 1960, in the amount o f $1,100,000,000, or thereabouts, repre senting an additional amount o f bills dated May 26, 1960, and to mature November 25, 1960, originally issued in tbe amount of $500,123,000, the additional and orig inal bills to be freely interchangeable. 182-day bills, for $500,000,000, or thereabouts, to be dated August 25, I960, and to mature February 23, 1961. The bills of both series will be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided, and at maturity their face amount 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 (maturity value). Tenders will be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty o’clock p.m., Eastern Daylight Saving time, Monday, August 22, 1960. Tenders will not be re ceived at the Treasury Department, Washington. Each tender must be for an even multiple of $1,000, and in the case of competitive tenders the price offered must be expressed on the basis of 100, with not more than three decimals, e.g., 99.925. Fractions may not be used. It is urged that 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. Others than banking institutions will not be permitted to submit tenders except for their own account. Tenders will be received without deposit from incorporated banks and trust companies and from responsible and recognized dealers in in vestment securities. Tenders from others must be accompanied by payment of 2 percent of the face amount of Treasury bills applied for, unless the tenders are accompanied by an express guaranty of payment by an incorporated bank or trust company. Immediately after the closing hour, tenders will be opened at the Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price range of accepted bids. Those sub mitting tenders will be advised of the acceptance or rejection thereof. The Secretary o f the Treasury expressly reserves the Department, released fo r publication today at 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 for the additional bills dated May 26, 1960, (92 days re maining until maturity date on November 25, 1960) and noncom petitive tenders for $100,000 or less for the 182-day bills without stated price from any one bidder will be accepted in full at the average price (in three decimals) of accepted competitive bids for the respective issues. Settlement for accepted tenders in accordance with the bids must be made or completed at the Federal Reserve Bank on August 25, 1960, in cash or other immediately available funds or in a like face amount of Treasury bills maturing August 25, 1960. Cash and exchange tenders will receive equal treatment. Cash adjustments will be made for differences between the par value of maturing bills accepted in exchange and the issue price of the new bills. The income derived from Treasury bills, whether 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 Treasury bills does not have any special treat ment, as such, under the Internal Revenue Code of 1954. The bills are subject to estate, inheritance, gift or other excise taxes, whether Federal or State, but are exempt from all taxa tion now or hereafter imposed on the principal or interest thereof by any State, or any of the possessions of the United States, or by any local taxing authority. For purposes of taxa tion the amount of discount at which Treasury bills are originally sold by the United States is considered to be interest. Under Sections 454(b) and 1221(5) of the Internal Revenue Code o f 1954 the amount 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 Treasury bills (other than life insurance com panies) issued hereunder need include in his income tax return only the difference between the price paid for such bills, whether on original issue or on subsequent purchase, and the amount actually received either upon sale or redemption at maturity during the taxable year for which the return is made, as ordinary gain or loss. Treasury Department Circular No. 418, Revised, and this notice, prescribe the terms of the Treasury bills and govern the conditions o f their issue. Copies of the circular may be obtained from any Federal Reserve Bank or Branch. T his Bank w ill receive tenders fo r both series up to 1 :30 p.m .. Eastern Daylight Saving time, M onday, A ugust 22, 1960, at the Securities Department o f its H ead Office and at its B uffalo Branch. T ender 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 “ T ender fo r T reasury Bills.” Tenders may be submitted by telegraph, su bject to written con firm ation ; they may not be submitted by telephone. P aym en t f o r the T reasury bills cannot be made b y credit through the T rea su ry T a x and L oan A ccou n t. S ettlem en t m ust be made in cash o r oth er im m ediately available fu n d s or in m aturing T reasury bills. Results o f the last offerin g o f T reasu ry bills (9 1 -d ay bills to be issued A u gu st 18, 1960, representing an additional amount o f bills dated M a y 19, 1960, and maturing N ovem ber 17, 1 960; and 182-day bills dated A ugu st 18, 1960, maturing F ebruary 16, 1961) are shown on the reverse side o f this circular. A lfred H ayes , P resident. Please note that the Treasury bills maturing November 25, 1960, will be 92-day bills. ( over) R E S U L T S OF L A ST O F F E R IN G OF T R E A S U R Y B IL L S (T W O SE R IE S T O B E ISSU E D A U G U S T 18,1960) R a n g e o f A c ce p te d C o m p e titiv e B id s 91-D a y T rea su ry Bills 1 8 2 -D a y T reasury Bills M aturing N o v em b er 17, 1960 Price M aturing F eb ru a ry 16, 1961 Approx. equiv. annual rate Price Approx. equiv. annual rate H ig h ............................. ................. 99.445 2 .1 9 6 % 9 8 .7 0 0 a 2 .5 7 1 % L o w ............................... ................. 99.417 2 .3 0 6 % 98.663 2 .6 4 5 % A verage ...................... ................. 99.424 2 .2 7 8 % 1 98.675 2.621 % x a Excepting two tenders totaling $1,700,000. 1 On a coupon issue of the same length and for the same amount invested, the return on these bills would provide yields of 2.32 percent for the 91-day bills, and 2.69 percent for the 182-day bills. Interest rates on bills are quoted in terms of bank discount, with the return related to the face amount of the bills payable at maturity rather than the amount invested, and their length in actual number of days related to a 360-day year. In contrast, yields on certificates, notes, and bonds are computed in terms of interest on the amount invested, and relate the number of days remaining in an interest payment period to the actual number of days in the period, with semiannual compounding if more than one coupon period is involved. (7 6 percent o f the amount o f 91-day bills bid fo r at the low price was a ccepted.) (4 percent o f the amount o f 182-day bills bid fo r at the low price was accepted.) T o ta l T e n d e rs A p p lie d fo r a n d A c c e p te d (B y F ederal R e se rv e D istricts ) 91-D a y T reasury Bills M aturing N o v em b er 17, 1960 Applied fo r District B oston ............................. ........ $ 25,303,000 1 8 2 -D a y T rea su ry Bills M aturing F ebruary 16, 1961 Accepted $ 15,298,000 Applied fo r $ 6,355,000 Accepted $ 6,355,000 N ew Y o r k ...................... ........ 1,431,215,000 750,215,000 752,724,000 363,124,000 Philadelphia .................. ........ 27,647,000 17,647,000 12,063,000 12,063,000 ........ 33,135,000 33,135,000 9,948,000 9,948,000 ........ 9,001,000 9,001,000 5,039,000 3,039,000 A tla n ta ............................. ........ 17,527,000 17,107,000 4,679,000 3,979,000 ........ 185,018,000 132,038,000 72,556,000 47,556,000 St. L o u i s ........................ ........ 20,668,000 19,668,000 4,317,000 4,317,000 M in n ea p olis.................... ........ 12,396,000 12,296,000 3,846,000 3,846,000 Kansas C ity .................. ........ 41,634,000 41,634,000 11,378,000 11,278,000 D a lla s ............................... ........ 11,705,000 11,705,000 5,021,000 5,021,000 San F r a n c is c o ............... 40,387,000 40,387,000 31,609,000 29,609,000 T ota l ............. ........ $1,855,636,000 $1,1 0 0 ,1 3 1 ,0 0 0 b b Includes $230,765,000 noncompetitive tenders accepted at the average price of 99.424. c Includes $47,326,000 noncompetitive tenders accepted at the average price of 98.675. $919,535,000 $ 5 0 0 ,1 35 ,000 c
@FedFRASER