The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
FE D E R AL RESERVE BANK O F N E W YORK Fiscal Agent of the United States f Circular No. 5 5 2 2 1 July 22, 1964 J L OFFERING OF TWO SERIES OF TREASURY BILLS $1,200,000,000 o f 91-Day Bills, Additional Amount, Series Dated April 30,1964, Due October 29,1964 (To Be Issued July 30,1964) $900,000,000 of 182-Day Bills, Dated July 30,1964, Due January 28,1965 To All Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve District: Following is the text of a notice issued by the Treasury Department, released for publication today at 4 p.m., Eastern Daylight Saving time: The tenders am ount change am ount T reasu ry D epartm ent, by this public notice, invites for tw o series of T reasu ry bills to the aggregate of $2,100,000,000, or thereabouts, for cash and in e x for T reasu ry bills m aturing July 30, 1964, in the of $2,001,550,000, as fo llo w s : 91-d a y bills (to m aturity date) to be issued July 30, 1964, in the am ount of $1,200,000,000, or thereabouts, representing an additional am ount of bills dated A p ril 30, 1964, and to mature O ctober 29, 1964, origi nally issued in the am ount of $900,482,000 (an addi tional $100,000,000 will be auctioned July 24 and will be outstandin g July 2 9 ), the additional and original bills to be freely interchangeable. 182-day bills, for $900,000,000, or thereabouts, to be dated July 30, 1964, and to mature January 28, 1965. T h e bills of both series will be issued on a discount basis under com petitive and noncom petitive bidding as hereinafter provided, and at m aturity their face am ount will be payable without interest. T h e y will be issued in bearer fo rm on ly , and in denom inations of $1,000, $5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000 (m atu rity va lu e). T enders will be received at Federal R eserve Banks and Branches up to the closing hour, one-thirty p .m ., Eastern D a yligh t Saving time, M on d ay, July 27, 1964. T en d ers will not be received at the T reasu ry D epartm ent, W ash in g ton . E ach tender m ust be for an even m ultiple of $1,000, and in the case of com petitive 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 m ay not be used. It is urged that tenders be m ade on the printed form s and forw arded in the special envelopes which will be supplied by Federal R eserve Banks or Branches on application therefor. B anking institutions generally m ay subm it tenders for account of custom ers, provided the nam es of the custom ers are set forth in such tenders. O thers than banking institu tions will not be perm itted to submit tenders except for their ow n account. T en ders will be received w ithout deposit from incorporated banks and trust com panies and from respon sible and recognized dealers in investm ent securities. T enders from others m ust be accom panied by paym ent of 2 percent of the face am ount of Treasury bills applied for, unless the tenders are accom panied by an express guaranty of paym ent by an incorporated bank or trust com pany. Im m ediately after the closin g hour, tenders will be opened at the Federal R eserve Banks and Branches, follow in g which public announcem ent will be m ade by the T reasu ry D ep art m ent of the am ount and price range of accepted bids. T h o se subm itting tenders will be advised of the acceptance or rejec tion thereof. T h e Secretary of the T re asu ry exp ressly re serves 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. Subject to these reservations, noncom petitive tenders for $200,000 or less for the additional bills dated A pril 30, 1964 (91 days rem aining until m aturity date on O ctob er 29, 1964) and noncom petitive tenders for $100,000 or less for the 182-day bills w ithout stated price from any one bidder will be accepted in full at the average price (in three deci m als) of accepted com petitive bids for the respective issues. Settlem ent for accepted tenders in accordance w ith the bids m ust be m ade or com pleted at the Federal Reserve Bank on July 30, 1964, in cash or other im m ediately available funds or in a like face am ount of T re asu ry bills m aturing July 30, 1964. Cash and exchange tenders will receive equal treat ment. Cash adjustm ents will be m ade for differences be tween the par value of m aturing bills accepted in exchange and the issue price o f the new bills. T h e incom e derived from T reasury bills, w hether interest or gain fro m the sale or other disposition of the bills, does not have any exem ption, as such, and loss fro m the sale or other disposition of T reasury bills does not have any special treatment, as such, under the Internal R evenue 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 im p osed 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 at w hich T re a s ury bills are originally sold by the U nited States is con sidered to be interest. U nder Sections 4 5 4 (b ) and 1 22 1(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, redeem ed or otherw ise disposed of, and such bills are excluded from consideration as capital assets. A cco rd in gly , the ow ner of T reasury 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, w hether on original 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 m ade, as ordinary gain or loss. T reasu ry D epartm ent Circular N o . 418 (current revision) and this notice prescribe the term s of the T reasu ry bills and govern the conditions of their issue. Copies of the circular 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 Daylight Saving time, Monday, July 27, 1964, 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. Results of the last offering of Treasury bills (91-day bills to be issued July 23, 1964, representing an additional amount of bills dated April 23, 1964, and maturing October 22, 1964; and 182-day bills dated July 23, 1964, maturing January 21, 1965) are shown on the reverse side of this circular. 19 A lfred H ayes , President. ( over) 14 FI FTI ETH A N N I V E R S A R Y 19 6 4 RESULTS OF LAST OFFERING OF TREASURY BILLS (TW O SERIES TO BE ISSUED JULY 23, 1964) Range of Accepted Competitive Bids 182-Day Treasury Bills Maturing January 21,1965 91-Day Treasury Bills Maturing October 22,1964 Price A pprox. equiv. annual rate .......................... ........ 99.128 3.450% Low ............................ ........ 99.112 99.115 High Average ...................... ........ Price Approx. equiz annual rate 98.182a 3.596% 3.513% 98.159 3.642% 3.503%! 98.170 3.619%! a E xcep tin g three tenders totaling $1,335,000. 1 O n a coupon issue of the sam e length and for the sam e am ount invested, the return on these bills w ould provide yields o f 3.58 percent for the 91-day bills, and 3.74 percent for the 182-day bills. Interest rates on bills are quoted in terms of bank discount, w ith the return related to the face am ount of the bills payable at m aturity rather than the am ount invested, and their length in actual number of days related to a 360-d ay year. In contrast, yields on certificates, notes, and bonds are computed in term s of interest on the am ount invested, and relate the num ber of days rem aining in an interest paym ent period to the actual num ber of days in the period, w ith semiannual co m p ou n d in g if m ore than one coupon period is involved. (31 percent of the amount of 91-day bills bid for at the low price was accepted.) (13 percent of the amount of 182-day bills bid for at the low price was accepted.) Total Tenders Applied for and Accepted (By Federal Reserve Districts) 91-Day Treasury Bills Maturing October 22,1964 District New Y o r k .................... Philadelphia ................ Cleveland...................... Richmond .................... A tla n ta.......................... $ 44,462,000 Applied for Accepted Applied for Boston .......................... 182-Day Treasury Bills Maturing January 21,1965 $ 34,462,000 $ 4,664,000 Accepted $ 4,664,000 1,497,218,000 819,978,000 978,876,000 618,826,000 41,076,000 16,076,000 8,858,000 3,858,000 22,522,000 25,168,000 25,168,000 9,906,000 4,835,000 4,835,000 28,090,000 8,394,000 8,394,000 75,411,000 22,522,000 9,906,000 34,188,000 Chicago ........................ 174,282,000 105,744,000 126,411,000 St. Louis ...................... 32,673,000 24,300,000 9,663,000 7,663,000 14,562,000 5,649,000 5,649,000 30,501,000 8,289,000 8,289,000 18,300,000 4,359,000 4,359,000 76,384,000 147,975,000 132,975,000 $1,333,141,000 $900,091,000° Minneapolis ................ Kansas City ................ D a lla s............................ San Francisco Total ............ ............ 20,942,000 31,536,000 18,300,000 142,794,000 $2,069,899,000 $ 1,200,825,000b b Includes $237,310,000 noncompetitive tenders accepted at the average price of 99.115. c Includes $60,605,000 noncompetitive tenders accepted at the average price of 98.170.