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FEDERAL RESERVE BANK OF NEW YORK Fiscal Agent o f the United States Circular N o . 9610 January 4, 1984 OFFERING OF TWO SERIES OF TREASURY BILLS $6,4®©,©©©,©©© off 91-Day Bills, To Be Issued Jasieary 12, 1984, Due April 12, 1984 $6,40®,00®,©0© off 182-Bay Bills, To Be Issued January 12, 1984, Bee July 12, 1984 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: The D epartm ent o f the Treasury, by this public n otice, invites tenders for tw o series o f Treasury bills totaling approxim ately $12,800 m illion, to be issued January 12, 1984. This offering will provide $475 m illion o f new cash for the Treasury, as the m aturing bills are outstanding in the am ount o f $12,324 m illion, including $806 m illion currently held by Federal Reserve Banks as agents for foreign and international m onetary authorities and $2,940 m illion currently held by Federal Reserve Banks for their ow n account. The tw o series offered are as follow s: 91-day bills (to m aturity date) for approxim ately $6,400 m illion, representing an additional am ount o f bills dated O ctober 13, 1983, and to m ature A pril 12, 1984 (C U SIP N o. 912794 EV2), currently outstanding in the am ount o f $6,115 m illion, the additional and original bills to be freely interchangeable. 182-day bills (to m aturity date) for approxim ately $6,400 m illion, representing an additional am ount o f bills dated July 14, 1983, and to m ature July 12, 1984 (C U SIP N o. 912794 FE9), currently outstanding in the am ount o f $7,846 m illion, the additional and original bills to be freely interchangeable. Both series o f bills will be issued for cash and in exchange for Treasury bills m aturing January 12, 1984. Tenders from Federal Reserve Banks for them selves and as agents for foreign and international m onetary authorities w ill be accepted at the weighted average bank discount rates o f accepted com petitive tenders. A d d ition al am ounts o f the bills m ay be issued to Federal Reserve Banks, as agents for foreign and international m onetary authorities, to the extent that the aggregate am ount o f tenders for such accounts exceeds the aggregate am ount o f m aturing bills held by them . The bills will be issued on a discount basis under com petitive and n on com petitive bidding, and at m aturity their par am ount will be payable w ithout interest. B oth series o f bills w ill be issued entirely in book-entry form in a m inim um am ount o f $10,000 and in any higher $5,000 m ultiple, on the records either o f the Federal Reserve Banks and Branches, or o f the Departm ent o f the Treasury. Tenders w ill be received at Federal Reserve Banks and Branches and at the Bureau o f the P ublic D ebt, W ashington, D .C . 20226, prior to 1:30 p .m ., Eastern Standard tim e, M onday, January 9 ,1 9 8 4 . Form P D 4632-2 (for 26-week series) or Form P D 4632-3 (for 13-week series) should be used to subm it tenders for bills to be m aintained on the book-entry records o f the D epartm ent o f the Treasury. Each tender m ust state the par am ount o f bills bid for, which m ust be a m inim um o f $10,000. Tenders over $10,000 m ust be in m ultiples o f $5,000. Com petitive tenders m ust also show the yield desired, expressed on a bank discount rate basis with tw o decim als, e .g ., 7.15% . Fractions m ay not be used. Banking institutions and dealers w ho m ake primary markets in G ov ernment securities and report daily to the Federal Reserve Bank o f N ew York their positions in and borrowings on such securities m ay subm it tenders for account o f custom ers, if the nam es o f the custom ers and the am ount for each custom er are furnished. Others are only perm itted to subm it tenders for their ow n account. Each tender m ust state the am ount o f any net long p osition in the bills being offered if such p osition is in excess o f $200 m illion. This inform ation should reflect positions held as o f 12:30 p .m ., Eastern tim e, on the day o f the auction. Such positions w ould include bills acquired through “ when issued” trading, and futures and forward transactions as well as holdings o f outstanding bills with the sam e m aturity date as the new offering, e .g ., bills with three m onths to m aturity previously o ffered as six-m onth bills. Dealers w ho m ake primary markets in G overnm ent securities and report daily to the Federal Reserve Bank o f N ew York their positions in and borrowings on such securities, when subm itting tenders for custom ers, m ust subm it a separate tender for each custom er w hose net long p osition in the bills being offered exceeds $200 m illion. A noncom petitive bidder m ay not have entered into an agreem ent, or m ay n ot m ake an agreem ent with respect to the purchase or sale or other disposition o f any noncom petitive awards o f this issue in this auction prior to the designated closing tim e for receipt o f tenders. P aym ent for the full par am ount o f the bills applied for m ust accom pany all tenders subm itted for bills to be m aintained on the book-entry records o f the Departm ent o f the Treasury. A cash adjustm ent w ill be m ade on all accepted tenders for the difference between the par paym ent subm itted and the actual issue price as determ ined in the auction. N o deposit need accom pany tenders from incorporated banks and trust com panies and from responsible and recognized dealers in invest m ent securities for bills to be m aintained on the book-entry records o f Federal Reserve Banks and Branches. A deposit o f 2 percent o f the par am ount o f the bills applied for m ust accom pany tenders for such bills from others, unless an express guaranty o f paym ent by an incorporated bank or trust com pany accom panies the tenders. Public announcem ent will be m ade by the D epartm ent o f the Treasury o f the am ount and yield range o f accepted bids. C om petitive bidders will be advised o f the acceptance or rejection o f their tenders. The Secretary o f the Treasury expressly reserves the right to accept or reject any or all tenders, in w hole or in part, and the Secretary’s action shall be final. Sub ject to these reservations, noncom petitive tenders for each issue for $1,000,000 or less w ithout stated yield from any one bidder will be accepted in full at the w eighted average bank discount rate (in two decim als) o f accepted com petitive bids for the respective issues. The calculation o f purchase prices for accepted bids will be carried to three decim al places on the basis o f price per hundred, e.g ., 99.923, and the determ inations o f the Secretary o f the Treasury shall be final. Settlem ent for accepted tenders for bills to be m aintained on the bookentry records o f Federal Reserve Banks and Branches must be m ade or com pleted at the Federal Reserve Bank or Branch on January 12, 1984, in cash or other im m ediately-available funds or in Treasury bills maturing January 12, 1984. Cash adjustm ents w ill be m ade for differences between the par value o f the m aturing bills accepted in exchange and the issue price o f the new bills. U nder Section 454(b) o f the Internal Revenue C ode, the am ount o f discount at which these bills are sold is considered to accrue when the bills are sold, redeem ed, or otherwise disposed o f. Section 1232(a)(4) provides that any gain on the sale or redem ption o f these bills that does n ot exceed the ratable share o f the acquisition discount m ust be included in the Federal incom e tax return o f the owner as ordinary incom e. The acquisition discount is the excess o f the stated redem ption price over the taxpayer’s basis (cost) for the bill. The ratable share o f this discount is determ ined by m ultiplying such discount by a fraction, the num erator o f which is the number o f days the taxpayer held the bill and the denom inator o f which is the number o f days from the day follow in g the taxpayer’s date o f purchase to the m aturity o f the bill. If the gain on the sale o f a bill exceeds the taxpayer’s ratable portion o f the acquisition discount, the excess gain is treated as short-term capital gain. D epartm ent o f the Treasury Circulars, P ublic D ebt Series— N os. 26-76 and 27-76, and this notice, prescribe the terms o f these Treasury bills and govern the conditions o f their issue. C opies o f the circulars and tender form s m ay be obtained from any Federal Reserve Bank or Branch, or from the Bureau o f the Public D ebt. This Bank will receive tenders for both series prior to 1:30 p.m ., Eastern Standard time, M onday, January 9, 1984, at the Securities D epartm ent of its Head Office and at its Buffalo Branch. Tender forms for both series are enclosed. Please be sure to use them to submit tenders and return them in the enclosed envelope. Form s for subm itting tenders directly to the Treasury are available from the Governm ent Bond Division of this Bank. Tenders not requiring a deposit may be subm itted by telegraph, subject to written confirm ation; no tenders may be subm itted by telephone. Paym ent fo r Treasury bills cannot be made by credit through the Treasury Tax and Loan Account. Settlem ent m ust be made in cash or other immediately available fu n d s or in Treasury securities maturing on or before the issue date. Results o f the last weekly offering of Treasury bills are shown on the reverse side of this circular. A n t h o n y M . S o l o m o n , P resid en t (OVER) RESULTS OF LAST WEEKLY OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED JANUARY S9 1984) Mange of Accepted Competitive Bids 91-Day Treasury Bills M aturing A p ril 5, 1984 Low r a te ............................ ............. High r a t e ......................... ............. Average rate ................... ............. 182-Day Treasury Bills M aturing July 5, 1984 Discount Rate Investment Rate1 Price Discount Rate Investment Rate1 Price 9.00% 9.05% 9.04% 9.36% 9.42% 9.41% 97.725 97.712 97.715 9.16% 9.19% 9.19% 9.77% 9.80% 9.80% 95.369 95.354 95.354 ‘Equivalent coupon-issue yield. (9 percent o f the am ount of 91-day bills bid for at the high discount rate was accepted.) (53 percent o f the am ount o f 182-day bills bid for at the high discount rate was accepted.) Total Tenders Received and Accepted 91-Day Treasury Bills M aturing A p ril 5, 1984 Received By F.R. District (and U.S. Treasury) B o sto n ......................................... New Y o r k .................................. P h ila d e lp h ia .............................. C le v e la n d .................................. R ich m o n d .................................. A t l a n t a ...................................... C h icag o ...................................... St. L o u is .................................... M in n eap o lis.............................. Kansas C ity ................................ Dallas ........................................ San F ran c isc o ............................ U.S. T re asu ry ............................ T o t a l s ..................................... $ 242,265,000 14,803,025,000 22,490,000 45,220,000 68,875,000 60,090,000 1,503,750,000 88,000,000 13,210,000 57,135,000 31,870,000 816,530,000 182-Day Treasury Bills M aturing July 5, 1984 Accepted $ 40,810,000 5,275,925,000 22,490,000 36,120,000 54,775,000 50,990,000 384,340,000 59,000,000 8,660,000 57,135,000 27,250,000 98,230,000 Received $ 184,195,000 17,078,130,000 17,970,000 52,565,000 112,060,000 174,530,000 1,394,990,000 114,290,000 25,955,000 75,965,000 31,465,000 858,965,000 Accepted $ 47,760,000 5,306,185,000 17,970,000 40,215,000 54,710,000 81,985,000 260,520,000 65,290,000 16,135,000 75,965,000 29,115,000 80,165,000 285,300,000 285,300,000 338,165,000 338,165,000 $18,037,760,000 $6,401,025,000 $20,459,245,000 $6,414,180,000 $15,366,390,000 1,056,865,000 $3,929,655,000 1,056,865,000 $17,611,860,000 999,475,000 $3,766,795,000 999,475,000 $16,423,255,000 1,390,710,000 223,795,000 $4,986,520,000 1,190,710,000 223,795,000 $18,611,335,000 1,300,000,000 547,910,000 $4,766,270,000 1,100,000,000 547,910,000 $18,037,760,000 $6,401,025,000 $20,459,245,000 $6,414,180,000 By class of bidder Public C o m p e titiv e ..................... N o n co m p etitiv e............... S u b t o t a l s ............................. Federal R e s e rv e ....................... Foreign Official Institutions .. T o t a l s ..................................... A n additional $6,505 thousand o f 13-week bills and an additional $12,790 thousand of 26-week bills will be issued to foreign official institutions for new cash.
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