97-12017. Sale and Issue of Marketable Book-Entry Treasury Bills, Notes, and Bonds (Department of the Treasury Circular, Public Debt Series No. 1-93)  

  • [Federal Register Volume 62, Number 89 (Thursday, May 8, 1997)]
    [Rules and Regulations]
    [Pages 25113-25115]
    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
    [FR Doc No: 97-12017]
    
    
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    DEPARTMENT OF THE TREASURY
    
    Fiscal Service
    
    31 CFR Part 356
    
    
    Sale and Issue of Marketable Book-Entry Treasury Bills, Notes, 
    and Bonds (Department of the Treasury Circular, Public Debt Series No. 
    1-93)
    
    AGENCY: Bureau of the Public Debt, Fiscal Service, Department of the 
    Treasury.
    
    ACTION: Final rule.
    
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    [[Page 25114]]
    
    SUMMARY: The Department of the Treasury (``Treasury'' or 
    ``Department'') is issuing in final form an amendment to 31 CFR Part 
    356 (Uniform Offering Circular for the Sale and Issue of Marketable 
    Book-Entry Treasury Bills, Notes, and Bonds). This final rule codifies 
    in the Code of Federal Regulations a change in the way the offering 
    amounts for Treasury bill auctions are announced and auction amounts 
    are awarded to the Federal Reserve Banks for their own account, also 
    referred to as the System Open Market Account. The change involves 
    treating such auction awards as additions to the announced offering 
    amount rather than making such awards within this amount.
    
    EFFECTIVE DATE: May 8, 1997.
    
    ADDRESSES: This final rule has been made available for downloading from 
    the Bureau of the Public Debt's Internet site at the following address: 
    www.publicdebt.treas.gov.
    
    FOR FURTHER INFORMATION CONTACT: Ken Papaj (Director), Lee Grandy or 
    Kurt Eidemiller (Government Securities Specialists), Bureau of the 
    Public Debt, Government Securities Regulations Staff, (202) 219-3632.
    
    SUPPLEMENTARY INFORMATION: 31 CFR Part 356, also referred to as the 
    uniform offering circular, sets out the terms and conditions for the 
    sale and issuance by the Department of the Treasury to the public of 
    marketable Treasury bills, notes, and bonds. The uniform offering 
    circular, in conjunction with offering announcements, represents a 
    comprehensive statement of those terms and conditions.\1\ This rule 
    amends the defined term ``public offering'' in section 356.2 and makes 
    an unrelated, administrative correction to paragraph (a) of section 
    356.13 of the uniform offering circular pertaining to the reporting of 
    net long positions.
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        \1\ The uniform offering circular was published as a final rule 
    on January 5, 1993 (58 FR 412). Amendments to the circular were 
    published on June 3, 1994 (59 FR 28773), March 15, 1995 (60 FR 
    13906), July 16, 1996 (61 FR 37007), August 23, 1996 (61 FR 43626), 
    October 22, 1996 (61 FR 54908), and January 6, 1997 (62 FR 846).
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        The current rules provide that, when the Department issues an 
    offering announcement for a regular Treasury bill auction (i.e., 13-, 
    26-, and 52-week bills), the stated public offering amount of each 
    security issue includes any amounts that would be awarded in the 
    auction to the Federal Reserve Banks for their own account and for the 
    accounts of foreign and international monetary authorities up to the 
    amount of maturing securities held by each. This practice differs from 
    the treatment of these amounts in the announcements and auctions of 
    cash management bills (``CMBs''), notes, and bonds. In these 
    announcements and auctions, the rules provide that the amounts to be 
    awarded to the Federal Reserve Banks for both their own account and for 
    the accounts of foreign and international monetary authorities are in 
    addition to the announced public offering amounts.
        In a press release dated March 18, 1997, Treasury announced a 
    change in the way bill auctions are announced, beginning with the 
    auction of 52-week bills that were auctioned on March 26, 1997. The 
    press release stated that amounts to be awarded to the Federal Reserve 
    Banks for their own account will be treated as additions to the 
    announced offering amount of Treasury bill auctions. As a result, 
    awards to the Federal Reserve Banks for their own account in bill 
    auctions are now treated as additions to the amount sold to the public. 
    The Department made this change to provide market participants with 
    more complete information and greater certainty as to the supply of 
    bills available to the public in an auction. Awards to the Federal 
    Reserve Banks for their own account in bill auctions will continue to 
    be at the weighted average discount rate of accepted competitive 
    tenders. The treatment of the amount to be awarded to the Federal 
    Reserve Banks for the accounts for foreign and international monetary 
    authorities in regular Treasury bill auctions remains unchanged.
        Accordingly, to codify this change in determining the public 
    offering amount for auctions of regular Treasury bills, section 356.2 
    of the uniform offering circular is amended by revising the definition 
    of the term ``public offering.'' It is anticipated that the sample 
    announcements of Treasury offerings, found in Exhibit A to Part 356, 
    will be revised to reflect this change once the recent proposed 
    amendments to accommodate three decimal bidding in .005 increments for 
    Treasury bill auctions, as published in the Federal Register on May 5, 
    1997 (62 FR 24375), are finalized.
        This final rule also makes an unrelated, administrative correction 
    to section 356.13(a). The section is being restated in its entirety to 
    reflect the intent of the revisions to the uniform offering circular 
    that were published on July 16, 1996 (61 FR 37007) and January 6, 1997 
    (62 FR 846). This correction does not involve any substantive changes.
    
    Procedural Requirements
    
        This final rule does not meet the criteria for a ``significant 
    regulatory action'' pursuant to Executive Order 12866.
        Because this rule relates to public contracts and procedures for 
    United States securities, the notice, public comment, and delayed 
    effective date provisions of the Administrative Procedure Act are 
    inapplicable, pursuant to U.S.C. 553(a)(2).
        As no notice of proposed rulemaking is required, the provisions of 
    the Regulatory Flexibility Act (5 U.S.C. 601, et seq.) do not apply.
        There is no new collection of information contained in this final 
    rule, and, therefore, the Paperwork Reduction Act does not apply. The 
    collections of information of 31 CFR Part 356 have been previously 
    approved by the Office of Management and Budget under section 3507(d) 
    of the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35) under 
    control number 1535-0112. Under this Act, an agency may not conduct or 
    sponsor, and a person is not required to respond to, a collection of 
    information unless it displays a valid OMB control number.
    
    List of Subjects in 31 CFR Part 356
    
        Bonds, Federal Reserve System, Government securities, Securities.
    
        For the reasons set forth in the preamble, 31 CFR Chapter II, 
    Subchapter B, Part 356, is amended as follows:
    
    PART 356--SALE AND ISSUE OF MARKETABLE BOOK-ENTRY TREASURY BILLS, 
    NOTES, AND BONDS (DEPARTMENT OF THE TREASURY CIRCULAR, PUBLIC DEBT 
    SERIES NO. 1-93)
    
        1. The authority citation for part 356 continues to read as 
    follows:
    
        Authority: 5 U.S.C. 301; 31 U.S.C. 3102, et seq.; 12 U.S.C. 391.
    
        2. Section 356.2 is amended by revising the definition of ``public 
    offering'' to read as follows:
    
    
    Sec. 356.2  Definitions.
    
    * * * * *
        Public offering means the par amount of securities offered to the 
    public for purchase in an auction. For all bills except cash management 
    bills, the public offering is the amount specified in the offering 
    announcement, less securities awarded in the auction to the Federal 
    Reserve Banks for the accounts of foreign and international monetary 
    authorities (up to the amount of maturing securities held by such 
    accounts). For notes, bonds, and cash management bills, the public 
    offering is
    
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    the same as the amount specified in the offering announcement.
    * * * * *
        3. Section 356.13 is amended by revising paragraph (a) to read as 
    follows:
    
    
    Sec. 356.13  Net long position.
    
        (a) Reporting net long positions. When bidding competitively, a 
    bidder must report the amount of its net long position when the total 
    of all of its bids in an auction plus the bidder's net long position in 
    the security being auctioned equals or exceeds the net long position 
    reporting threshold amount. The threshold amount for any particular 
    security will be as stated in the offering announcement for that 
    security. (See Sec. 356.10.) That amount will be $2 billion for bills, 
    notes, and bonds unless otherwise stated in the offering announcement. 
    For example, the net long position reporting threshold amount may be 
    less than $2 billion for smaller security offerings, e.g., certain 
    inflation-indexed securities or cash management bills. If the bidder 
    either has no position or has a net short position and the total of all 
    of its bids equals or exceeds the threshold amount, e.g., $2 billion, a 
    net long position of zero must be reported. In cases where a bidder 
    that is required to report the amount of its net long position has more 
    than one bid, the bidder's total net long position should be reported 
    in connection with only one bid. A bidder that is a customer must 
    report its reportable net long position through only one depository 
    institution or dealer. (See Sec. 356.14(c).)
    * * * * *
        Dated: April 30, 1997.
    Gerald Murphy,
    Fiscal Assistant Secretary.
    [FR Doc. 97-12017 Filed 5-7-97; 8:45 am]
    BILLING CODE 4810-39-M
    
    
    

Document Information

Effective Date:
5/8/1997
Published:
05/08/1997
Department:
Fiscal Service
Entry Type:
Rule
Action:
Final rule.
Document Number:
97-12017
Dates:
May 8, 1997.
Pages:
25113-25115 (3 pages)
PDF File:
97-12017.pdf
CFR: (2)
31 CFR 356.2
31 CFR 356.13