BANKING & FINANCE - May 3, 1994

Treasury Bill Rates Up: The Treasury Department sold $11.4 billion of new three-month bills at an average discount rate of 4%, up from 3.85% last week. Another $11.5 billion of new six-month bills was sold at an average discount rate of 4.41%, up from 4.25%. The three-month bill rate was the highest since they sold for 4.08% on March 30, 1992. The six-month bill rate was the highest since they averaged 4.5% on Nov. 25, 1991. The new discount rates understate the actual return to investors--4.1% for three-month bills with a $10,000 bill selling for $9,898.90, and 4.57% for a six-month bill selling for $9,777.10. The discount rate reflects the price discount received when government securities are purchased at less than face value.