BOND TELLER
the
Volume 27 No. 1 May, 1998 • Department of the Treasury • Bureau of the Public Debt
VAN ZECK NAMED
PUBLIC DEBT
COMMISSIONER
V
an Zeck, a life-long career
employee of the Department
of Treasury’s Bureau of Public
Debt was appointed to head the
Bureau on February 15, 1998.
He succeeds Richard L. Gregg,
who became Commissioner of
Treasury’s Financial Management
Service last December.
Zeck, a native of Morgantown,
West Virginia, began his Federal ser- Treasurer of the United States Mary Ellen Withrow is shown with Tom Gelonski,
vice in Washington with the Bureau’s President and CEO of National City Bank of Pennsylvania, during a Savings
Internal Audit Staff in 1971 right after Bonds Campaign kick-off for the Greater Pittsburgh Area. Mr. Gelonski is serving
graduation from West Virginia his second year as volunteer chair for the Pittsburgh Geographic Area Savings
University. Bond campaign.
Reflecting on his career, Zeck said
THE WIZARD Wizard! Version 2.0 is coming soon
that computers and electronic pro-
to the Public Debt Web Site.
cessing were not part of his college TURNS 2 Download it and try it out!
education or American life then as
I
they are today. But he learned. f you and your customers have The new Wizard gives you much
tried and liked the Savings Bonds more information about your bonds.
At the Bureau he held positions Wizard, the new and convenient In addition to current value and inter-
in data processing, marketable securi- way for bond owners to keep track of est earned, you can see the bonds’
ties operations and administration. their bond inventories on their home yield-to-date, next accrual date and
(Continued on page 4) PCs, you are going to love the new final maturity date. This information
will help bondowners make decisions
about redeeming bonds. Color
IN THIS ISSUE coding is used to highlight which
ONLINE BOND SALES bonds have reached final maturity
VAN ZECK NAMED ARE COMING SOON . .p 3 and no longer earn interest and which
COMMISSIONER . . . . .p 1 matured bonds are eligible for
WHAT’S NEW ON exchange to HH bonds.
THE WIZARD THE WEBSITE . . . . . . . .p 3
TURNS 2 . . . . . . . . . . .p 1 The new Wizard is easier to use.
DIRECT DEPOSIT JUST More inventory can be seen by en-
HOME BANKING GOT EASIER . . . . . . . . .p 3 larging the Wizard’s window on the
UPDATE . . . . . . . . . . .p 2 screen. Inventories also can be
TAX LAW ON BOND retrieved more easily. A list of the
EASY-TO-USE EDUCATION EXCLUSIONS last five inventories used can be
RESOURCE GUIDE . . . .p 2 CHANGED . . . . . . . . . .p 4 shown. (Continued on page 3)
HOME BANKING UPDATE: SAVINGS BONDS RESOURCE GUIDE EASY-TO-USE;
PEOPLE ARE BUYING A REAL HELP TO BOND TELLERS
BONDS FROM HOME savings bond interest, putting bonds
T
he “Savings Bonds Resource
in a trust, or what to do with bonds
T
he last issue of the Bond Teller Guide” has been available to
reported that bond sales agents for over a year. It is after the owners are dead? This infor-
through home banking systems designed to help tellers look up mation is in the Guide as well. Using
was imminent. Now it is a reality. answers to customers’ questions the detailed instructions on filling out
Bonds are now being sold through quickly and easily. various forms, agents can be helpful
institutions’ individually branded to customers who want transactions
It also contains a wealth of infor- that have to be approved and
home banking systems across the
mation useful to agents processing processed by a Federal Reserve
country.
bonds. It covers purchasing, reissu- Office.
The first three institutions started ing (re-registering), exchanging, and
selling bonds through their home redeeming savings bonds. There’s Just for agents (not for the pub-
banking systems in the last quarter of also a chapter on EZ CLEAR that lic), the Guide contains a list of toll-
1997. These pioneering financial insti- explains what to do with bonds after free telephone numbers of Federal
tutions were: Community Credit you redeem them. Reserve and Treasury Offices that can
Union in Plano, Texas, Dollar Bank in help when the Guide doesn’t provide
Quick reference guides provide the answer.
Pittsburgh, Pennsylvania, and First
step-by-step, easy-to-use helps for
Technology Credit Union in If you haven’t seen the “Savings
savings bond redemptions, assisting
Beaverton, Oregon. Bonds Resource Guide,” check
customers with reissues, and han-
In the first quarter of 1998, dling exchanges of E/EE bonds and around to see if someone else at your
Beaumont Area Educators Federal savings notes for Series H/HH bonds. institution has one. If not, contact the
Credit Union in Beaumont, Texas, and Federal Reserve Office that provides
Also included are rules on accept- savings bond services to your region.
Britton & Koontz First National Bank
able identification for savings bond q
in Natchez, Mississippi, also started
transactions—i.e., information on
selling savings bonds through home
how agents can avoid losses due to
banking. Public Debt maintains an Rate Information
paying savings bonds to the wrong
up-to-date list of banks and credit
person. In addition, situations that Current interest rates on
unions selling bonds through home
might occur less frequently are cov- savings bonds can be
banking on its web site (www.
ered: bonds lost or stolen, getting obtained by calling the
savingsbonds.gov/sav/savhblst.htm).
errors corrected, offering bond-a- toll-free recording
Is your bank on the the list yet?
month plans, and gift bonds.
1-800-4US-BOND
Many more banks and credit
unions will soon begin selling bonds
Have customers ever asked you (1-800-487-2663).
about Federal income taxation of
through home banking. The Bureau of
Public Debt has already made contact
with over 100 institutions interested in
this innovative approach. It will sim- Change of Address
plify their bond processing work and
Editor: Please change the mailing address
provide customers with a highly desir-
able new service. Several have From: (Recipient please affix old label here or provide the
already started building their systems identification number printed above the address on the label.)
and will begin selling bonds in the
next few months.
In addition to working directly
with banks and credit unions, The To:
Bureau of Public Debt also is working
with software developers on this
project. Many software companies
provide banks with home banking
software. Several of these companies
are now working to add bond sales to Please change the number of copies I receive
their home banking software. from to .
(Continued on page 4)
I no longer wish to receive “The Bond Teller.”
ONLINE BOND SALES WIZARD DIRECT DEPOSIT JUST
ARE COMING SOON (Continued from page 1) GOT EASIER
W
The Wizard now protects against hen customers come to
C
oming soon . . . The Savings
Bond Connection! Customers duplication of serial numbers in an deposit H/HH bond
will be able to buy savings inventory. The last inventory used interest checks, tell them
bonds through the Internet 24 hours a can be automatically displayed when that the Bureau of Public Debt has
day, seven days a week from The the Wizard starts up. Or, the Wizard provided a new, easy way to sign up
Bureau of the Public Debt’s web site. can be opened showing an empty for Direct Deposit.
Customers simply fill out an online inventory or no inventory at all.
Everyone benefits when govern-
form, securely transmit order and Two views of the total value of ment checks are directly deposited.
payment information, and the bond bonds are shown: the redemption The bank saves money, the H/HH
arrives within two weeks. total and the inventory total. The bond owner receives payment with
Secure Electronic Transaction redemption total is the amount for no delay and the government saves
(SET) technology will be used so that which the bonds can be redeemed. money.
customers may buy bonds directly The inventory total shows the
“worth” of bonds in an inventory. That is why the government is
from the Bureau of Public Debt using trying to encourage payment recipi-
a credit card. For bonds not yet eligible for
redemption the value is shown as the ents to sign up for direct deposit for
SET is a new technology that is purchase price. This is a truer picture their federal payments by January 1,
expected to be the standard for secure of the bond inventory’s actual value. 1999.
Internet commerce using credit cards. AND THE BEST NEWS IS, SIGN-
SET allows us to know all parties in Bond owners will be able to sort
their bonds in a variety of ways: in ING UP IS EASY! To make the transi-
the transaction, so we know who’s tion as easy as possible a new Public
sending us information. Customers ascending or descending order by
serial number, denomination, or Debt Form 5396, (PD F 5396) has been
will know they’re dealing with the developed. Current income savings
Bureau of Public Debt (and not some- issue date.
bonds owners no longer have to go to
one pretending to be the Bureau) and Even with all these improve- a financial institution to fill out the
that payment information is going to ments the Wizard is just as simple to SF 1199A.
an authorized location. q use as before. Just enter bond serial
numbers and issue dates once for a The new form asks the signer for
record of bonds and their values. basic information—name, address,
Update the Wizard every six months. telephone number, and Social
WHAT’S NEW ON THE Security Number. The form also calls
It’s easy and it’s free!
WEB SITE for account number, type of account,
The Internet address for the routing number, name of financial
H
ave you been to www. Wizard is: http://www.publicdebt. institution, and the telephone number
savingsbonds.gov lately? treas.gov/sav/savwizar.htm. of the institution.
You may notice a few
changes. Here’s what you’ll find: Those who don’t have Internet If interest payments are going to
access may purchase diskettes for $17 be deposited in a checking account,
—Areas identified for special by writing to: Superintendent of the signer doesn’t have to include this
reader interests: employees of finan- Documents, US Government Printing information on the form. Instead, he
cial institutions, investors, savings Office: Attn.: Electronic Products, or she can provide account informa-
bond campaign leaders, and kids. P.O. Box 37082, Washington, DC tion and most of the information
20013-70882. q about the institution by sending a
—The financial institution’s area
voided check with the form.
features an online version of the The
Bond Teller or the latest on selling Best of all, HH/H bond owners
bonds through home banking. More REDEMPTION TABLES can sign up at home and mail the
will be added to the banks’ area ON NEW SCHEDULE paperwork directly to the address on
soon. Tell the Bureau of Public Debt the form: Bureau of the Public Debt,
what you would like to see. Would Parkersburg, WV 26106-2186.
T
he issue schedule for Tables of
you like to receive an e-mail notifica- Redemption Values has been
tion when the latest edition of The Direct deposit sign up forms,
changed. Current tables cover PD F 5396, as well as other savings
Bond Teller is available? E-mail sug- the six-month period from March
gestions to SavBonds@bpd.treas.gov. bond forms can be obtained from the
1998 through August 1998. Booklets Federal Reserve Office that services
from now on will cover six-month your institution with savings bond
periods that begin each March and services. The new form also will be
(Continued on page 4) September. available on the Internet. q
TAX LAW ON BOND VAN ZECK program, a “do-it-yourself”
payroll program through
EDUCATION EXCLUSIONS (Continued from page 1) which savers can set their
CHANGED Mr. Zeck headed the own schedule for deductions
Bureau team that imple- for bond purchases directly
from Treasury through a
“T
he Taxpayer Relief Act of mented TREASURY
1997” enacted August 5, DIRECT, an automated Federal Reserve Bank.
1997, added contributions online book entry securi- “This really does mark new
to qualified State tuition programs to ties system for T-bills, beginnings in how savings
the definition of qualified higher notes and bonds that bonds and other financial
education expenses contained in the allowed the Department VAN ZECK products will be marketed,”
education savings bond statute which of Treasury to eliminate Zeck said.
took effect for savings bonds issued paper securities. He was Assistant
after December 31, 1989. Commissioner (Financing) from 1982 “I believe the pace of investor
and was named Deputy acceptance will be very rapid...
This means that the taxpayer may perhaps far more rapid than others
Commissioner in 1987.
redeem savings bonds, pay the pro- believe.”
ceeds into a qualified State tuition As Deputy Commissioner he has
program, and exclude the interest been involved in the Bureau’s work to “The inflation-indexed savings
earned from adjusted gross income, if modernize the processing of savings bond already announced by Treasury
he meets the existing requirements of bonds. Many of these changes banks will be our target for the next few
the education savings bond statute. and other financial institutions have months,” he said. “This new product
already seen. Many more are just will give investors a new choice in
Participation in the qualified bonds offered along side the tradition-
getting started.
State tuition program is treated in the al Series EE Savings Bonds.”
same manner as payment to a quali- As Commissioner, he sees
fied higher education institution. savings bonds as an “exciting market- “We will provide financial institu-
ing and sales challenge. We must do tions with information on the new
The change takes effect for tax- bond as soon as possible,” he said.
everything we can to have more and
able years beginning after Dec. 31,
more people purchase savings
1997, which means that the first “And, it is very important that the
bonds.”
redemption to fund a State tuition audience of The Bond Teller knows
plan could be done for tax year 1998. The challenge, he says “is to keep that we value the support and contri-
the information fresh, to spread the butions of the thousands of workers in
A qualified State tuition pro- financial institutions on behalf of the
word to make sure investors know
gram is defined as one established savings bond program.”
the value of the product as part of an
and maintained by a State under
investment portfolio.” As an example
which a person may purchase tuition “It is a valuable service, an
he cited the May 1997 change in bond
credits on behalf of a designated ben- absolutely integral part of savings
interest calculation and accrual sched-
eficiary or make payments to an bonds’ success. We need that service
ules. “A lot of people don’t know
account established to meet the quali- and it is very much appreciated by the
about savings bonds,” he said.
fied higher education expenses of the Treasury and the Bureau of Public
beneficiary. A primary challenge, he said, “is Debt.” q
to continue our efforts to improve
IRS has not issued any guidance
services for the savings bonds pur-
on the new provisions.
chaser.” HOME BANKING
Customers should be advised to
One improvement he mentioned (Continued from page 2)
consult their tax advisor or the IRS
is the Savings Bond Wizard, a
before redeeming their bonds for this To find out more about bonds and
windows based computer product
purpose. q home banking, check out the home
that he calls “amazingly effective.”
See story on page 1 about version 2.0 banking web site (www.savingsbonds.
WEB SITE soon to be available. gov/sav/savhb.htm), e-mail the home
banking team (homebank@bpd.treas.
(Continued from page 3) Other improvements he cited gov), or call 304-480-3600.
were home banking, where banks are
—Downloadable forms: many of including savings bonds in their own
our most popular forms can now be electronic offerings for customers; The Bond Teller is a publication of
downloaded without having to wait online sales that will allow people to The Department of the Treasury
for forms to arrive in the mail! Bureau of the Public Debt
buy bonds directly from the Treasury
Washington, D.C. 20239
—Spanish-language information through a secure system. Currently
on bonds. q under development is an EasySaver Editor: Sheila E. Nelson SB 2252