BANKING & FINANCE - May 23, 1995

Treasury Bill Rates Rise: The Treasury Department sold $13.6 billion of new three-month bills at an average discount rate of 5.72%, up from 5.71% last week. Another $13.7 billion of new six-month bills were sold at an average discount rate of 5.72%, up from 5.69%. The three-month bill rate was the highest since they sold for 5.74% on May 1. The six-month bill rate was the highest since they averaged 5.84% on May 1. The new discount rates understate the actual return to investors: 5.90% for three-month bills, with a $10,000 bill selling for $9,855.40, and 5.99% for a six-month bill selling for $9,709.20. The discount rate reflects the price discount received when government securities are purchased at less than face value.