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FEDERAL RESERVE BAMK OF MEW YORK Fiscal Agent o f the United States Circular N o . 9646n February 29, 1984 [ OFFERING'OF TWO SEMES OF TREASURY MELS il $6,200,000,000 off 91-Bay Bills, To B@ Issimedl March 8, 1984, Pm© Hum© 7, 1984 $6,200,000,000 off 182-Oay Bills, To B© Issued March 8, 1984, Pm© September 6, 1984 To All Banking Institutions, and Others Concerned, in the Second Federal Reserve District: Following is the text of a notice issued by the Treasury Department: The D epartm ent o f the Treasury, by this public notice, invites tenders for two series o f Treasury bills totaling approxim ately $12,400 m illion, to be issued M arch 8, 1984. This offering will not provide new cash for the Treasury, as the m aturing bills are outstanding in the am ount o f $12,476 m illion, including $992 m illion currently held by Federal Reserve Banks as agents for foreign and international m onetary authorities and $3,203 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 maturity date) for approxim ately $6,200 m illion, representing an additional am ount o f bills dated D ecem ber 8, 1983, and to m ature June 7, 1984 (C U SIP N o . 912794 FB5), currently outstanding in the am ount o f $6,336 m illion, the additional and original bills to be freely interchangeable. 182-day bills (to maturity date) for approximately $6,200 m illion, representing an additional am ount o f bills dated September 8, 1983, and to mature September 6, 1984 (C U SIP N o . 912794 FG 4), currently outstanding in the am ount o f $7,773 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 maturing March 8, 1984. Tenders from Federal Reserve Banks for themselves and as agents for foreign and international m onetary authorities will be accepted at the w eighted average bank discount rates o f accepted com petitive tenders. A dditional 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 maturity their par am ount will be payable without interest. Both series o f bills will 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 Department o f the Treasury. Tenders will be received at Federal Reserve Banks and Branches and at the Bureau o f the Public D ebt, W ashington, D .C . 20226, prior to 1:30 p .m ., Eastern Standard tim e, M onday, M arch 5, 1984. Form P D 4632-2 (for 26-week series) or Form P D 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 m ust be a m inim um o f $10,000. Tenders over $10,000 must be in m ultiples o f $5,000. C om petitive tenders must also show the yield desired, expressed on a bank discount rate basis with tw o 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 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 permitted to submit tenders for their ow n 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 m aturity date as the new offering, e.g ., bills with three m onths to maturity previously offered as six-m onth bills. Dealers who 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 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 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. Paym 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 will 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. Com 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 tw o decimals) 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 m ust be m ade or com pleted at the Federal Reserve Bank or Branch on M arch 8, 1984, in cash or other im m ediately-available funds or in Treasury bills maturing March 8, 1984. Cash adjustm ents will 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. 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 determined 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 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. Departm 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, M arch 5, 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. Form s 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 subm itted 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 of the last weekly offering of Treasury bills are shown on the reverse side o f this circular. A n t h o n y M . So l o m o n , P r e s id e n t. (O V E R ) RESULTS OF LAST WEEKLY OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED MARCH 1, 1984) Range off Accepted Competitive ®Id§ 91-Day Treasury Bills M aturing M ay 31, 1984 Low r a te ........................................... High r a t e ......................................... Average rate .................................. Discount Rate Investment Rate1 9.18% 9.21% 9.20% 9.53% 9.56% 9.55% 182-Day Treasury Bills M aturing A u g u st 30, 1984 Price Discount Rate 97.680 97.672 97.674 9.30% a 9.34% 9.33% Investment Rate1 9.90% 9.94% 9.93% Price 95.298 95.278 95.283 ‘Equivalent coupon-issue yield. The use o f 365 days in these calculations has been resumed. E x c e p tin g one tender o f $1,000,000. (30 percent of the am ount of 91-day bills bid for at the high discount rate was accepted.) (42 percent of 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 M ay 31, 1984 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. Louis ..................................... M in n eap o lis.............................. Kansas C ity ................................ Dallas ........................................ San F ran c isc o ............................ Accepted Received $ 233,655,000 16,729,965,000 27,430,000 46,875,000 110,270,000 52,670,000 1,278,830,000 118,890,000 35,450,000 32,115,000 39,340,000 847,540,000 ' 182-Day Treasury Bills M aturing A ugu st 30, 1984 $ 36,655,000 5,654,100,000 27,430,000 36,105,000 67,020,000 45,560,000 76,830,000 70,750,000 14,950,000 32,115,000 29,340,00091,485,000 Received $ 152,580,000 14,661,270,000 18,200,000 32,110,000 56,155,000 61,105,000 1,070,710,000 123,360,000 21,280,000 69,740,000 26,755,000 858,490,000 Accepted $ 52,580,000 5,540,170,000 18,200,000 32,110,000 56,155,000 52,045,000 1*24,610,000 65,360,000 21,280,000 64,740,000 21,755,000 92,330,000 U.S. T re asu ry ............................ 223,615,000 223,615,000 287,560,000 287,560,000 T o t a l s ............................ $19,776,645,000 $6,405,955,000 $17,439,315,000 $6,428,895,000 $17,173,695,000 • 975,165,000 $3,803,005,000 975,165,000 $14,745,130,000 949,185,000 $3,734,710,000 949,185,000 Federal R e s e rv e ....................... Foreign Official Institutions . . $18,148,860,000 1,291,985,000 335,800,000 $4,778,170,000 1,291,985,000 335,800,000 $15,694,315,000 1,250,000,000 495,000,000 $4,683,895,000 1,250,000,000 495,000,000 T o t a l s ............................... $19,776,645,000 $6,405,955,000 $17,439,315,000 $6,428,895,000 By class of bidder Public C o m p e titiv e ..................... N o ncom petitive............... S ubtotals ........................
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