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FEDERAL RESERVE BANK OF NEW YORK Fiscal Agent of the United States Circular No. 9687 June 6, 1984 OFFERING OF TWO SERIES OF TREASURY BILLS $6,400,000,000 of 91-Day Bills, To Be Issued June 14, 1984, Due September 13, 1984 $6,400,000,000 of 182-Day Bills, To Be Issued June 14, 1984, Due December 13, 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: markets in Government securities and report daily to the Federal Reserve The Department of the Treasury, by this public notice, invites tenders Bank of New York their positions in and borrowings on such securities, for two series of Treasury bills totaling approximately $12,800 million, to when submitting tenders for customers, must submit a separate tender for be issued June 14, 1984. This offering will provide $150 million of new each customer whose net long position in the bills being offered exceeds cash for the Treasury, as the maturing bills were originally issued in the $200 million. amount of $12,653 million. The two series offered are as follows: A noncompetitive bidder may not have entered into an agreement, or 91-day bills (to maturity date) for approximately $6,400 million, may not make an agreement with respect to the purchase or sale or other representing an additional amount of bills dated March 15, 1984, and to mature September 13, 1984 (CUSIP No. 912794 disposition of any noncompetitive awards of this issue in this auction FU3), currently outstanding in the amount of $6,267 million, prior to the designated closing time for receipt of tenders. the additional and original bills to be freely interchangeable. Payment for the full par amount of the bills applied for must accom 182-day bills for approximately $6,400 million, to be dated pany all tenders submitted for bills to be maintained on the book-entry June 14, 1984, and to mature December 13, 1984 (CUSIP No. records of the Department of the Treasury. A cash adjustment will be 912794 GE8). made on all accepted tenders for the difference between the par payment Both series of bills will be issued for cash and in exchange for Treasury submitted and the actual issue price as determined in the auction. bills maturing June 14, 1984. In addition to the maturing 13-week and No deposit need accompany tenders from incorporated banks and 26-week bills, there are $7,776 million of maturing 52-week bills. The trust companies and from responsible and recognized dealers in invest disposition of this latter amount was announced last week. Federal ment securities for bills to be maintained on the book-entry records of Federal Reserve Banks and Branches. A deposit of 2 percent of the par Reserve Banks, as agents for foreign and international monetary authorities, currently hold $1,017 million, and Federal Reserve Banks for amount of the bills applied for must accompany tenders for such bills from others, unless an express guaranty of payment by an incorporated their own account hold $5,181 million of the maturing bills. These amounts represent the combined holdings of such accounts for the three bank or trust company accompanies the tenders. issues of maturing bills. Public announcement will be made by the Department of the Treasury Tenders from Federal Reserve Banks for themselves and as agents for of the amount and yield range of accepted bids. Competitive bidders will foreign and international monetary authorities will be accepted at the be advised of the acceptance or rejection of their tenders. The Secretary of the Treasury expressly reserves the right to accept or reject any or all weighted average bank discount rates of accepted competitive tenders. tenders, in whole or in part, and the Secretary’s action shall be final. Sub Additional amounts of the bills may be issued to Federal Reserve Banks, ject to these reservations, noncompetitive tenders for each issue for as agents for foreign and international monetary authorities, to the extent $1,000,000 or less without stated yield from any one bidder will be that the aggregate amount of tenders for such accounts exceeds the aggregate amount of maturing bills held by them. For purposes of deter accepted in full at the weighted average bank discount rate (in two decimals) of accepted competitive bids for the respective issues. The mining such additional amounts, foreign and international monetary calculation of purchase prices for accepted bids will be carried to three authorities are considered to hold $962 million of the original 13-week decimal places on the basis of price per hundred, e.g., 99.923, and the and 26-week issues. The bills will be issued on a discount basis under competitive and non determinations of the Secretary of the Treasury shall be final. Settlement for accepted tenders for bills to be maintained on the bookcompetitive bidding, and at maturity their par amount will be payable entry records of Federal Reserve Banks and Branches must be made or without interest. Both series of bills will be issued entirely in book-entry completed at the Federal Reserve Bank or Branch on June 14, 1984, in form in a minimum amount of $10,000 and in any higher $5,000 multiple, on the records either of the Federal Reserve Banks and Branches, or of cash or other immediately-available funds or in Treasury bills maturing June 14, 1984. Cash adjustments will be made for differences between the the Department of the Treasury. Tenders will be received at Federal Reserve Banks and Branches and at par value of the maturing bills accepted in exchange and the issue price of the Bureau of the Public Debt, Washington, D.C. 20239, prior to 1:00 the new bills. In addition, Treasury Tax and Loan Note Option p.m., Eastern Daylight Saving time, Monday, June 11, 1984. Form PD Depositaries may make payment for allotments of bills for their own 4632-2 (for 26-week series) or Form PD 4632-3 (for 13-week series) should accounts and for account of customers by credit to their Treasury Tax be used to submit tenders for bills to be maintained on the book-entry and Loan Note Accounts on the settlement date. Under Section 454(b) of the Internal Revenue Code, the amount of records of the Department of the Treasury. Each tender must state the par amount of bills bid for, which must be discount at which these bills are sold is considered to accrue when the bills are sold, redeemed, or otherwise disposed of. Section 1232(a)(4) provides a minimum of $10,000. Tenders over $10,000 must be in multiples of that any gain on the sale or redemption of these bills that does not exceed $5,000. Competitive tenders must also show the yield desired, expressed the ratable share of the acquisition discount must be included in the on a bank discount rate basis with two decimals, e.g., 7.15%. Fractions Federal income tax return of the owner as ordinary income. The may not be used. Banking institutions and dealers who make primary markets in Gov acquisition discount is the excess of the stated redemption price over the ernment securities and report daily to the Federal Reserve Bank of New taxpayer’s basis (cost) for the bill. The ratable share of this discount is determined by multiplying such discount by a fraction, the numerator of York their positions in and borrowings on such securities may submit which is the number of days the taxpayer held the bill and the tenders for account of customers, if the names of the customers and the denominator of which is the number of days from the day following the amount for each customer are furnished. Others are only permitted to taxpayer’s date of purchase to the maturity of the bill. If the gain on the submit tenders for their own account. Each tender must state the amount sale of a bill exceeds the taxpayer’s ratable portion of the acquisition of any net long position in the bills being offered if such position is in discount, the excess gain is treated as short-term capital gain. excess of $200 million. This information should reflect positions held as Department of the Treasury Circulars, Public Debt Series—Nos. of 12:30 p.m ., Eastern time, on the day of the auction. Such positions 26-76 and 27-76, and this notice, prescribe the terms of these Treasury would include bills acquired through “ when issued” trading, and futures bills and govern the conditions of their issue. Copies of the circulars and and forward transactions as well as holdings of outstanding bills with the tender forms may be obtained from any Federal Reserve Bank or Branch, same maturity date as the new offering, e.g., bills with three months to or from the Bureau of the Public Debt. maturity previously offered as six-month bills. Dealers who make primary T h is B a n k w ill receive tenders fo r b o th series p rio r to 1 :0 0 p .m ., E a ste rn D a y lig h t Saving tim e, M o n d ay , Ju n e 11, 1984, at the Securities D ep artm ent o f its H ead O ffic e and at its B u ffa lo B ra n ch . T en d er fo rm s fo r b oth series are enclosed. P le a se be sure to use them to su b m it tenders and retu rn them in th e enclosed envelope. F o rm s fo r su b m ittin g tenders d irectly to th e T re a su ry are available fro m the G ov ern m en t B o n d D iv ision o f this B a n k . T end ers n o t requ iring a d ep osit m ay b e su b m itted by teleg rap h , s u b je c t to w ritten c o n firm a tio n ; no tenders m ay b e subm itted by telep h o n e. S ettlem en t m ust be m ade in cash or oth er im m ed iately a v ailab le funds or in T re a su ry secu rities m atu rin g on or b e fo re th e issue d ate. Treasury Tax and Loan Note Option Depositaries may make payment fo r Treasury bills by credit to their Treasury Tax and Loan Note Accounts. R esu lts o f the last w eekly o ffe rin g o f T re a su ry bills are show n on the reverse side o f this circu la r. A n tho ny M. So l o m o n , President. (over ) RESULTS OF LAST WEEKLY OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED JUNE 7, 1984) Mange o f A ccepted C om petitive Bids 91-D ay Treasury Bills M aturing Sep tem b er 6, 1984 Discount Rate Low r a t e ............................. ............. H igh r a t e ........................... ............. A verage ra te .................... ............. 9 .8 3 % a 9.95% 9.90% 182-Day Treasury Bills M a tu rin g D ecem ber 6, 1984 Investment Rate1 Price Discount Rate Investment Rate1 Price 10.22% 10.35% 10.29% 97.515 97.485 97.498 10.56% 10.58% 10.57% 11.31% 11.33% 11.32% 94.661 94.651 94.656 'Equivalent coupon-issue yield. Excepting one tender of $750,000. (7 percent o f the am o u n t o f 182-day bills bid for at the high discount rate was accepted.) (41 percent o f the am o u n t o f 91-day bills bid fo r at the high discount rate was accepted.) T o tal T enders Received and A ccepted 91-D ay Treasury Bills M atu rin g Sep tem b er 6, 1984 By F.R. District (and U.S. Treasury) B o s to n .......................................... New Y o r k .................................... P h ila d e lp h ia ............................... C le v e la n d .................................... R ic h m o n d .................................... A tla n ta ......................................... C h ic a g o ........................................ St. L o u i s ...................................... M in n e a p o lis ............................... K ansas C ity .................................. D allas .......................................... San F r a n c is c o ............................. 251,265,000 12,865,990,000 31,960,000 116,695,000 42,900,000 43,255,000 1,188,500,000 42,225,000 14,915,000 47,255,000 36,050,000 1,161,230,000 Received Accepted Received $ 182-Day Treasury Bills M atu rin g D ecem ber 6, 1984 $ 87,915,000 4,897,240,000 31,960,000 110,795,000 42,900,000 43,255,000 253,500,000 39,225,000 14,915,000 47,255,000 36,050,000 502,550,000 $ 192,125,000 15,395,330,000 27,110,000 56,285,000 68,465,000 43,910,000 1,100,430,000 36,070,000 17,135,000 52,505,000 31,165,000 1,096,805,000 Accepted $ 57,125,000 5,211,425,000 27,110,000 56,285,000 55,605,000 36,910,000 131,770,000 26,080,000 12,135 000 50,110,000 21,515,000 415,705,000 297,865,000 297,865,000 302,875,000 302,875,000 $16,140,105,000 $6,405,425,000 $18,420,210,000 $6,404,650,000 $13,222,745,000 1,142,260,000 $3,488,065,000 1,142,260,000 $15,286,890,000 991,520,000 $3,271,330,000 991,520,000 F ederal R e s e r v e ......................... F oreign O fficial In stitu tio n s . . $14,365,005,000 1,685,100,000 90,000,000 $4,630,325,000 1,685,100,000 90,000,000 $16,278,410,000 1,600,000,000 541,800,000 $4,262,850,000 1,600,000,000 541,800,000 T o t a l s ................................... $16,140,105,000 $6,405,425,000 $18,420,210,000 $6,404,650,000 U .S. T r e a s u r y ............................. T o t a l s .................................... By class of bidder Public C o m p e titiv e ...................... N o n c o m p e titiv e ................ S u b t o t a l s ...........................
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