View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

FEDERAL RESERVE BANK O F NEW YORK
F isca l A g e n t o f the U n ite d S tates

l

C ir c u la r N o . 5 1 0 0
N o v e m b e r 1, 1961

~[
J

OFFERING OF TWO SERIES OF TREASURY BILLS
$1,200,000,000 of 91-Day Bills, Additional Amount, Series Dated August 10, 1961, Due Feb. 8, 1962
(To Be Issued November 9, 1961)
$500,000,000 of 182-Day Bills, Dated November 9, 1961, Due May 10, 1962
To All Incorporated Banks and Trust Companies, and Others
Concerned, in the Second Federal Reserve District:

Follow ing is the text of a notice issued by the Treasury Department, released for publication today at
4 p.m., Eastern Standard tim e:
T h e T reasu ry D epartm ent, by this pu blic n otice, invites
tenders fo r tw o series o f T reasu ry bills to the aggregate amount
o f $1,700,000,000, or thereabouts, fo r cash and in exch ange for
T reasu ry bills m aturing N ovem ber 9, 1961, in the amount of
$1,700,694,000, as f o llo w s :
91-day bills (to m aturity date) to be issued N ovem ber 9,
1961, in the am ount o f $1,200,000,000, or thereabouts,
representing an addition al amount o f bills dated A u ­
gust 10, 1961, and to mature February 8, 1962, origin a lly
issued in the am ount o f $600,153,000, the addition al and
o rigin a l bills to be freely interchangeable.
182-day bills, fo r $500,000,000, or thereabouts, to be dated
N ovem ber 9, 1961, and to mature M ay 10, 1962.
T h e bills o f both series w ill be issued on a discount basis
under com petitive and n oncom petitive b idd in g as hereinafter
provided, and at m aturity their face amount w ill be payable
w ithout interest. T h ey w ill be issued in bearer form only, and
in denom inations o f $1,000, $5,000, $10,000, $100,000, $500,000
and $1,000,000 (m aturity va lu e).
T en ders w ill be received at Federal R eserve Banks and
B ranches up to the clo sin g hour, on e-thirty o ’ clo ck p.m., E a st­
ern Standard time, M on day, N ovem ber 6, 1961. Ten ders w ill
not be received at the T reasu ry D epartm ent, W ash ington.
Each tender must be fo r an even m ultiple o f $1,000, and in the
case o f com petitive tenders the price offered must be expressed
on the basis o f 100, w ith not m ore than three decim als, e.g.,
99.925. F raction s m ay not be used. It is urged that tenders
be m ade on the printed form s and forw a rd ed in the special
envelopes w hich w ill be supplied by Federal R eserve Banks
o r Branches on application therefor.
O thers than banking institutions w ill not be perm itted to
subm it tenders except fo r their ow n account. T en ders w ill be
received w ithout deposit from in corporated banks and trust
com panies and from responsible and recogn ized dealers in in ­
vestm ent securities. Tenders from others must be accom panied
by paym ent o f 2 percent o f the face amount o f T reasu ry bills
applied for, unless the tenders are accom panied by an express
guaranty o f paym ent by an in corporated bank or trust com pany.
Im m ediately after the closin g hour, tenders w ill be opened
at the Federal R eserve Banks and B ranches, fo llo w in g w hich
pu blic announcem ent w ill be made by the T reasu ry D epartm ent
o f the am ount and price range o f accepted bids. T h ose sub­
m itting tenders w ill be advised o f the acceptance or rejection

thereof. T h e Secretary o f the T reasu ry expressly reserves the
right to accept or reject any or all tenders, in w hole or in part,
and his action in any such respect shall be final. Su bject to
these reservations, noncom petitive tenders for $200,000 or less
for the addition al bills dated A u gust 10, 1961 (91 days rem aining
until m aturity date on February 8, 1962) and noncom petitive
tenders fo r $100,000 or less for the 182-day bills w ithout stated
price from any one bidder w ill be accepted in fu ll at the
average price (in three decim als) o f accepted com petitive bids
fo r the respective issues. Settlement fo r accepted tenders in
a ccord a n ce with the bids must be made or com pleted at the
Federal R eserve Bank on N ovem ber 9, 1961, in cash or other
im m ediately available funds or in a like face am ount o f
T reasu ry bills m aturing N ovem ber 9, 1961. Cash and exch ange
tenders w ill receive equal treatment. Cash adjustm ents w ill be
made fo r differences between the par value o f m aturing bills
accepted in exch ange and the issue price o f the new bills.
T he incom e derived from T reasu ry bills, w hether interest
or gain from the sale or other disposition o f the bills, does not
have any exem ption, as such, and loss from the sale or other
disp osition o f T reasu ry bills does not have any special treat­
ment, as such, under the Internal Revenue C ode o f 1954. T he
bills are subject to estate, inheritance, g ift or other excise
taxes, whether Federal or State, but are exem pt from all ta x a ­
tion n ow or hereafter im posed on the principal or interest
th ereof by any State, or any o f the possessions o f the U nited
States, or by any loca l ta x in g authority. F or purposes o f ta x a ­
tion the am ount o f discount at w hich T reasu ry bills are
o rigin a lly sold by the U nited States is con sidered to be interest.
U nder Sections 454(b) and 1221(5) o f the Internal Revenue
Code o f 1954 the am ount o f discount at w hich bills issued
hereunder are sold is not con sidered to accru e until such bills
are sold, redeem ed or otherw ise disposed of, and such bills are
exclu d ed from con sidera tion as capital assets. A cco rd in g ly ,
the ow ner o f T reasu ry bills (oth er than life insurance co m ­
panies) issued hereunder need include in his incom e ta x return
only the difference between the price paid for such bills,
whether on origin a l issue or on subsequent purchase, and the
am ount actually received either upon sale or redem ption at
m aturity during the taxable year for w hich the return is made,
as ord inary gain or loss.
T reasu ry D epartm ent C ircu lar N o. 418, R evised, and this
notice, prescribe the terms o f the T reasu ry bills and govern
the con dition s o f their issue. Copies o f the circu la r m ay be
obtained from any Federal R eserve B ank or Branch.

This Bank will receive tenders for both series up to 1 :30 p.m., Eastern Standard time, Monday,
November 6, 1961, at the Securities Department of its Head Office and at its Buffalo Branch. Tender forms for
the respective series are enclosed. Please use the appropriate forms 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.
R esu lts o f the last o ffe r in g o f T r e a s u r y b ills (9 1 -d a y b ills to be issu ed N o v e m b e r 2, 1961, re p re sen tin g
an a d d ition a l am ou n t o f b ills dated A u g u s t 3, 1961, and m a tu rin g F e b ru a ry 1, 1962; and 182-day b ills dated
N o v e m b e r 2, 1961, m a tu rin g M a y 3, 1962) are sh o w n on the re v e rse side o f this circu lar.




A

l f r e d

H

a y e s

,

President.
(

over)

R E S U L T S O F L A S T O F F E R IN G O F T R E A S U R Y B IL L S
N O V E M B E R 2, 1961)

(T W O S E R IE S T O B E ISSU E D

Range o f A ccepted Com petitive Bids

91-Day Treasury Bills
Maturing February 1,1962
Price

182-Day Treasury Bills
Maturing May 3, 1962

Approx. equiv.
annual rate

Price

Approx. equiv.
annual rate

98.686

2.599%

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

99.428

2.263%

L o w ........................ ........
Average ................ ........

99.421

2.291%

98.677

2.617%

99.424

2.280%!

98.679

2.613%!

High

1 O n a cou pon issue o f the same length and fo r the same am ount invested, the return on these b ills w ou ld provide
yields o f 2.32 percent fo r the 91-day bills, and 2.68 percent fo r the 182-day bills. Interest rates on bills are quoted in
terms o f bank discount, with the return related to the fa ce amount o f the bills payable at m aturity rather than the amount
invested, and their length in actual num ber o f days related to a 360-day year. In contrast, yields on certificates, notes,
and bonds are com puted in terms o f interest on the am ount invested, and relate the num ber o f days rem aining in an
interest paym ent p eriod to the actual num ber o f days in the period, with sem iannual com pou n din g if m ore than one
cou pon period is involved.

(52 percent of the amount of 91-day bills
bid for at the low price was accepted.)

(52 percent of the amount of 182-day bills
bid for at the low price was accepted.)

Total Tenders A p p lied fo r and A ccepted (B y Federal Reserve Districts)

91-Day Treasury Bills
Maturing February 1,1962
Accepted

Applied for

District

Boston .......................... ..........

$

29,151,000

182-Day Treasury Bills
Maturing May 3, 1962

$

12,647,000

A pplied for

$

1,338,000

Accepted

$

1,313,000

New Y o r k .................... ..........

1,603,327,000

707,494,000

1,275,338,000

482,827,000

Philadelphia ................ ..........

24,528,000

9,378,000

8,914,000

1,796,000

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

33,702,000

27,552,000

22,505,000

7,085,000

Richm ond .................... ..........

10,632,000

10,392,000

8,848,000

2,590,000

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

20,192,000

14,967,000

4,729,000

4,315,000

Chicago ........................ ........

232,523,000

154,639,000

126,189,000

60,464,000

St. L o u i s ...................... ........

29,313,000

19,033,000

9,879,000

5,779,000

Minneapolis ................ ........

22,383,000

16,163,000

6,500,000

3,915,000

Kansas City ................ ........

38,501,000

26,501,000

20,858,000

13,961,000

Dallas

16,350,000

16,150,000

4,437,000

4,437,000

96,240,000

85,320,000

40,321,000

11,801,000

Cleveland
Atlanta

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

San Francisco ............
T ota l

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

$2,156,842,000

$1,100,236,000a

$1,529,856,000

a Includes $215,258,000 noncompetitive tenders accepted at the average price of 99.424.
b Includes $56,198,000 noncompetitive tenders accepted at the average price of 98.679.




$600,283,000b


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102