EMBARGOED UNTIL 11:00 A.M. CONTACT: Office of Financing
March 22, 2004 202/691-3550
TREASURY OFFERS 2-YEAR NOTES
The Treasury will auction $26,000 million of 2-year notes to refund $24,540
million of publicly held notes maturing March 31, 2004, and to raise new cash of
approximately $1,460 million.
In addition to the public holdings, Federal Reserve Banks hold $8,334 million
of the maturing notes for their own accounts, which may be refunded by issuing
an additional amount of the new security.
Up to $1,000 million in noncompetitive bids from Foreign and International
Monetary Authority (FIMA) accounts bidding through the Federal Reserve Bank of New
York will be included within the offering amount of the auction. These noncompetitive
bids will have a limit of $100 million per account and will be accepted in the order
of smallest to largest, up to the aggregate award limit of $1,000 million.
TreasuryDirect customers requested that we reinvest their maturing holdings
of approximately $670 million into the 2-year note.
The auction will be conducted in the single-price auction format. All competi-
tive and noncompetitive awards will be at the highest yield of accepted competitive
tenders. The allocation percentage applied to bids awarded at the highest yield will
be rounded up to the next hundredth of a whole percentage point, e.g., 17.13%.
The notes being offered today are eligible for the STRIPS program.
This offering of Treasury securities is governed by the terms and conditions
set forth in the Uniform Offering Circular for the Sale and Issue of Marketable Book-
Entry Treasury Bills, Notes, and Bonds (31 CFR Part 356, as amended).
Details about the new security are given in the attached offering highlights.
oOo
Attachment
HIGHLIGHTS OF TREASURY OFFERING TO THE PUBLIC OF
2-YEAR NOTES TO BE ISSUED MARCH 31, 2004
March 22, 2004
Offering Amount ............................... $26,000 million
Maximum Award (35% of Offering Amount) ........ $ 9,100 million
Maximum Recognized Bid at a Single Yield ...... $ 9,100 million
NLP Reporting Threshold ....................... $ 9,100 million
Description of Offering:
Term and type of security ..................... 2-year notes
Series ........................................ M-2006
CUSIP number .................................. 912828 CD 0
Auction date .................................. March 24, 2004
Issue date .................................... March 31, 2004
Dated date .................................... March 31, 2004
Maturity date ................................. March 31, 2006
Interest rate ................................. Determined based on the highest
accepted competitive bid
Yield .........................................Determined at auction
Interest payment dates ........................September 30 and March 31
Minimum bid amount and multiples .............. $1,000
Accrued interest payable by investor .......... None
Premium or discount ........................... Determined at auction
STRIPS Information:
Minimum amount required ....................... $1,000
Corpus CUSIP number .......................... 912820 KA 4
Due date(s) and CUSIP number(s)
for additional TINT(s) ...................... March 31, 2006 - - 912833 2C 3
Submission of Bids:
Noncompetitive bids:
Accepted in full up to $5 million at the highest accepted yield.
Foreign and International Monetary Authority (FIMA) bids: Noncompetitive bids
submitted through the Federal Reserve Banks as agents for FIMA accounts.
Accepted in order of size from smallest to largest with no more than $100
million awarded per account. The total noncompetitive amount awarded to Federal
Reserve Banks as agents for FIMA accounts will not exceed $1,000 million. A
single bid that would cause the limit to be exceeded will be partially accepted
in the amount that brings the aggregate award total to the $1,000 million limit.
However, if there are two or more bids of equal amounts that would cause the
limit to be exceeded, each will be prorated to avoid exceeding the limit.
Competitive bids:
(1) Must be expressed as a yield with three decimals, e.g., 7.123%.
(2) Net long position for each bidder must be reported when the sum of the total
bid amount, at all yields, and the net long position equals or exceeds the NLP
reporting threshold stated above.
(3) Net long position must be determined as of one half-hour prior to the
closing time for receipt of competitive tenders.
Receipt of Tenders:
Noncompetitive tenders:
Prior to 12:00 noon eastern standard time on auction day.
Competitive tenders:
Prior to 1:00 p.m. eastern standard time on auction day.
Payment Terms: By charge to a funds account at a Federal Reserve Bank on issue date,
or payment of full par amount with tender. TreasuryDirect customers can use the Pay
Direct feature which authorizes a charge to their account of record at their
financial institution on issue date.