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FEDERAL RESERVE BANK OF NEW YORK Fiscal Agent of the United States Circular N o. 9676 M ay 2, 1984 OFFERING OF TWO SERIES OF TREASURY BILLS $4,000,000,©©(0) of 91-Day Bills, To Be Issued May 10, 1984, Due August 9, 1984 $4,000,000,000 off 182-Day Bills, To Be Issued May 10, 1984, Due November 8, 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 Department o f the Treasury, by this public notice, invites tenders for tw o series o f Treasury bills totaling approximately $8,000 m illion, to be issued M ay 10, 1984. This offering will result in a paydown for the Treasury o f about $4,690 m illion, as the maturing bills are outstanding in the am ount o f $12,690 m illion, including $1,191 m illion currently held by Federal Reserve Banks as agents for foreign and international monetary authorities and $2,701 m illion currently held by Federal Reserve Banks for their own account. The size of this offering has been reducedfrom re cent levels in order to ensure that the current debt ceiling is not exceeded. The tw o series offered are as follow s: 91-day bills (to maturity date) for approxim ately $4,000 m illion, representing an additional am ount o f bills dated A ugust 11, 1983, and to mature A ugust 9, 1984 (C U SIP N o. 912794 FF6), currently outstanding in the am ount o f $14,246 m illion, the additional and original bills to be freely interchangeable. 182-day bills for approxim ately $4,000 m illion, to be dated May 10, 1984, and to mature Novem ber 8, 1984 (CUSIP N o. 912794 G A6). Both series o f bills will be issued for cash and in exchange for Treasury bills maturing M ay 10, 1984. Tenders from Federal Reserve Banks for themselves and as agents for foreign and international monetary authorities will be accepted at the weighted average bank discount rates o f accepted com petitive tenders. Additional am ounts o f the bills may be issued to Federal Reserve Banks, as agents for foreign and international monetary authorities, to the extent that the aggregate am ount o f tenders for such accounts exceeds the aggregate amount o f maturing bills held by them. The bills will be issued on a discount basis under com petitive and non com petitive bidding, and at maturity their par am ount will be payable w ithout 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 multiple, on the records either o f the Federal Reserve Banks and Branches, or o f the Departm ent 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 . 20239, prior to 1:00 p .m ., Eastern Daylight Saving tim e, M onday, May 7, 1984. Form PD 4632-2 (for 26-week series) or Form PD 4632-3 (for 13-week series) should be used to subm it tenders for bills to be maintained on the book-entry records o f the Departm ent o f the Treasury. Each tender m ust state the par am ount o f bills bid for, which must be a m inim um 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 w ho 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 names o f the custom ers and the am ount for each custom er are furnished. Others are only permitted to subm it 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 who make primary markets in Governm 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 may not have entered into an agreem ent, or may not make 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 time 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 m ade on all accepted tenders for the difference between the par payment subm itted and the actual issue price as determined 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 maintained 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 Department 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 without stated yield from any one bidder will be accepted in full at the weighted average bank discount rate (in two 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 decimal 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 made or com pleted at the Federal Reserve Bank or Branch on May 10, 1984, in cash or other im m ediately-available funds or in Treasury bills maturing May 10, 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. In addition, Treasury Tax and Loan Note Option Depositaries may make payment for allotments of bills for their own accounts and for account of customers by credit to their Treasury Tax and Loan Note Accounts on the settlement date. 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 must 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 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 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. Departm ent 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 form s 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 1:00 p.m., Eastern Daylight Saving time, Monday, May 7, 1984, at the Securities Department of its Head Office and at its Buffalo Branch. Revised 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. Settlement must be made in cash or other immediately available funds or in Treasury securities maturing on or before the issue date. T r e a s u r y T a x a n d L o a n N o t e O p tio n D e p o s ita r ie s m a y m a k e p a y m e n t f o r T r e a s u r y b ills b y c r e d it to th e ir T r e a s u r y T a x a n d L o a n N o t e A c c o u n ts . Results of the last weekly offering of Treasury bills are shown on the reverse side of this circular. A n t h o n y M. So l o m o n , President (OVER) RESULTS OF LAST WEEKLY OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED MAY 3, 1984) Mange of Accepted Competitive Bids 9 1 -D a y T r e a s u r y B ills M a tu r in g A u g u s t 2 , 1 9 8 4 Discount Rate 9.68% 9.69% 9.68% Low rate.......................... ............ High r a te ........................ ............ Average rate .................. ............ Investment Rate1 10.06% 10.07% 10.06% 1 8 2 -D a y T r e a s u r y B ills M a tu r in g N o v e m b e r 1, 1 9 8 4 Discount Rate 9.87% 9.88% 9.88% Price 97.553 97.551 97.553 Investment Rate1 10.53% 10.54% 10.54% Price 95.010 95.005 95.005 'Equivalent coupon-issue yield. (94 percent of the amount of 182-day bills bid for at the high discount rate was accepted.) (49 percent of the amount of 91-day bills bid for at the high discount rate was accepted.) Total Tenders Received and Accepted 9 1 -D a y T r e a s u r y B ills M a tu r in g A u g u s t 2 , 1 9 8 4 Received 69,545,000 15,097,480,000 34,640,000 53,140,000 58,380,000 55,340,000 923,780,000 36,720,000 25,315,000 56,775,000 42,535,000 1,024,450,000 Accepted $ 49,545,000 2,150,425,000 34,640,000 38,140,000 47,380,000 51,050,000 120,780,000 28,720,000 17,665,000 55,640,000 32,535,000 101,065,000 U.S. Treasury.......................... 273,445,000 . ........................ By class of bidder Public Com petitive.................... Noncompetitive.............. 1 8 2 -D a y T r e a s u r y B ills M a tu r in g N o v e m b e r 1, 1 9 8 4 Received 154,745,000 14,441,210,000 22,265,000 34,545,000 56,870,000 53,395,000 941,195,000 38,150,000 23,025,000 46,930,000 25,470,000 1,227,330,000 Accepted $ 44,745,000 2,231,560,000 22,265,000 34,045,000 45,870,000 43,245,000 66,395,000 20,150,000 22,425,000 45,340,000 15,470,000 87,330,000 273,445,000 323,070,000 323,070,000 $17,751,545,000 $3,001,030,000 $17,388,200,000 $3,001,910,000 $15,403,120,000 1,121,825,000 $1,052,605,000 1,121,825,000 $14,969,980,000 927,620,000 $ 983,690,000 927,620,000 $16,524,945,000 1,111,600,000 Federal R eserve...................... 115,000,000 Foreign Official Institutions. . $2,174,430,000 711,600,000 115,000,000 $15,897,600,000 800,000,000 690,600,000 $1,911,310,000 400,000,000 690,600,000 $17,751,545,000 $3,001,030,000 $17,388,200,000 $3,001,910,000 By F.R. District (and U.S. Treasury) Boston...................................... New Y o rk ................................ Philadelphia............................ Cleveland................................ Richmond................................ A tlan ta.................................... Chicago.................................... St. L o u is.................................. M inneapolis............................ Kansas City.............................. Dallas ...................................... San Francisco.......................... T otals $ S u b t o t a l s ............................. T o t a l s ..................................... $
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