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FEDERAL RESERVE BANK OF NEW YORK Fiscal Agent of the United States Circular N o . 9615 January 11, 1984 OFFERING OF TWO SERIES OF TREASURY BILLS $6,400,000,000 o f 91-D ay B ills, T o Be Issued J a n u a ry 19, 1984, D u e A p ril 19, 1984 $6,400,000,000 off 182-D ay B ills, T o Be Issued J a n u a ry 19, 1984, D u e Ju ly 19, 1984 To All Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve District: F o llo w in g is th e tex t o f a n o tice issued by th e T re asu ry D e p a rtm e n t: The Departm ent o f the Treasury, by this public notice, invites tenders for tw o series o f Treasury bills totaling approxim ately $12,800 m illion, to be issued January 19, 1984. This offering will provide $500 m illion o f new cash for the Treasury, as the maturing bills are outstanding in the am ount o f $12,289 m illion, including $1,275 m illion currently held by Federal Reserve Banks as agents for foreign and international m onetary authorities and $2,096 m illion currently held by Federal Reserve Banks for their own account. The two 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 April 21, 1983, and to mature April 19, 1984 (CUSIP N o. 912794 EF7), currently outstanding in the am ount o f $13,807 m illion, the additional and original bills to be freely interchangeable. 182-day bills for approxim ately $6,400 m illion, to be dated January 19, 1984, and to mature July 19, 1984 (C U SIP N o. 912794 FN9). Both series o f bills will be issued for cash and in exchange for Treasury bills maturing January 19, 1984. Tenders from Federal Reserve Banks for them selves and as agents for foreign and international m onetary authorities will be accepted at the weighted average bank discount rates o f accepted com petitive tenders. A d ditional am ounts o f the bills may 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 maturing 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 without interest. Both series o f bills will be issued entirely in book-entry form in a minim 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 Department o f the Treasury. Tenders will be received at Federal Reserve Banks and Branches and at the Bureau o f the Public Debt, W ashington, D .C . 20226, prior to 1:30 p .m ., Eastern Standard tim e, M onday, January 16, 1984. Form PD 4632-2 (for 26-week series) or Form PD 4632-3 (for 13-week series) should be used to submit tenders for bills to be m aintained on the book-entry records o f the Department o f the Treasury. Each tender must state the par am ount o f bills bid for, which must be a minimum o f $10,000. Tenders over $10,000 must be in m ultiples o f $5,000. Com petitive tenders must also show the yield desired, expressed on a bank discount rate basis with two decim als, e.g ., 7.15% . Fractions may not be used. Banking institutions and dealers who m ake primary markets in G ov ernment securities and report daily to the Federal Reserve Bank o f New York their positions in and borrowings on such securities may 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 permitted to submit tenders for their own account. Each tender must state the am ount o f any net long position in the bills being offered if such position 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 would include bills acquired through “ when issued” trading, and futures and forward transactions as well as holdings o f outstanding bills with the sam e maturity date as the new offering, e.g ., bills with three m onths to maturity previously offered 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, must subm it a separate tender for each custom er w hose net long position 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 not m ake an agreement 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. Paym ent for the full par am ount o f the bills applied for must 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 will be made 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 ment 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 must 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 b ook entry records o f Federal Reserve Banks and Branches must be m ade or com pleted at the Federal Reserve Bank or Branch on January 19, 1984, in cash or other im m ediately-available funds or in Treasury bills maturing January 19, 1984. Cash adjustm ents will be m ade for differences between the par value o f the maturing bills accepted in exchange and the issue price o f the new bills. Under 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 not 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 numerator 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 maturity 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. Department o f the Treasury Circulars, Public Debt 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. Copies o f the circulars and tender forms m ay be obtained from any Federal Reserve Bank or Branch, or from the Bureau o f the Public Debt. This Bank will receive tenders for both series prior to 1:30 p.m ., Eastern Standard time, M onday, January 16, 1984, at the Securities Departm 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. Forms for submitting tenders directly to the Treasury are available from the Government Bond Division of this Bank. Tenders not requiring a deposit may be submitted by telegraph, subject to written confirmation; no tenders may be submitted by telephone. Paym ent fo r Treasury bills cannot be made by credit through the Treasury Tax and Loan A ccount. 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. ANTHONY M . SOLOMON, President. (OVER) RESULTS OF LAST WEEKLY OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED JANUARY 12, 1984) Range of Accepted Competitive Bids 91-Day Treasury Bills M aturing A pril 12, 1984 Low r a te ............................ ............. High r a t e .......................... ............. Average rate ................. .. ............. 182-Day Treasury Bills M aturing July 12, 1984 Discount Rate Investment Rate1 Price Discount Rate Investment Rate1 Price 8.90% a 8.93% 8.92% 9.26% 9.29% 9.28% 97.750 97.743 97.745 9.08% 9.11% 9.10% 9.67% 9.71% 9.70% 95.410 95.394 95.399 'Equivalent coupon-issue yield. aExcepting one tender o f $2,000,000. (79 percent of the am ount of 91-day bills bid for at the high discount rate was accepted.) (40 percent o f the am ount of 182-day bills bid for at the high discount rate was accepted.) Total Tenders Received and Accepted 91-Day Treasury Bills M aturing A pril 12, 1984 Received By F.R. District (and U.S. Treasury) B o sto n ........................................ New Y o r k .................................. P h ila d elp 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 ............................ $ 247,390,000 14,614,380,000 30,150,000 45,625,000 47,425,000 54,045,000 1,497,385,000 105,550,000 28,190,000 45,985,000 31,475,000 1,276,170,000 182-Day Treasury Bills M aturing July 12, 1984 Accepted $ 62,390,000 5,105,330,000 30,150,000 40,625,000 47,215,000 54,045,000 278,695,000 76,550,000 20,905,000 45,485,000 30,425,000 308,020,000 Received $ 167,210,000 15,306,605,000 28,445,000 65,955,000 86,110,000 155,175,000 1,060,820,000 101,185,000 29,925,000 64,585,000 35,835,000 1,191,685,000 Accepted $ 60,210,000 5,104,885,000 28,445,000 47,955,000 82,110,000 154,275,000 145,620,000 72,185,000 24,925,000 64,585,000 32,835,000 178,685,000 U.S. T re asu ry ............................ 320,865,000 320,865,000 423,695,000 423,695,000 T o t a l s ......................................... $18,344,635,000 $6,420,700,000 $18,717,230,000 $6,420,410,000 $15,648,725,000 1,170,575,000 $3,974,790,000 1,170,575,000 $15,466,245,000 1,194,685,000 $3,419,425,000 1,194,685,000 Federal R e s e rv e ....................... Foreign Official Institutions .. $16,819,300,000 1,515,335,000 10,000,000 $5,145,365,000 1,265,335,000 10,000,000 $16,660,930,000 1,425,000,000 631,300,000 $4,614,110,000 1,175,000,000 631,300,000 T o t a l s ......................................... $18,344,635,000 $6,420,700,000 $18,717,230,000 $6,420,410,000 By class of bidder Public C o m p e titiv e ..................... N o ncom petitive............... S u b t o t a l s ...............................
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