BANKING & FINANCE - Dec. 19, 1995

T-Bill Interest Rates Fall Slightly: The Treasury Department sold $14.1 billion in three-month bills at an average discount rate of 5.15%, down from 5.30% last week. Another $14.1 billion was sold in six-month bills at an average discount rate of 5.15 %, down from 5.20%. The three-month bill rate was the lowest since the securities sold for 5.14% on Sept. 2a5; the six-month bill rate was the lowest since they averaged 5.05% on Sept. 19, 1994. The rates understate the actual return to investors: 5.31% for new three-month bills, with a $10,000 bill selling for $9,869.80, and 5.38% for a six-month bill selling for $9,739.60. In a separate report, the Federal Reserve Board said the average yield for one-year Treasury bills, the most popular index for making changes in adjustable-rate mortgages, was 5.35% last week, unchanged from the previous week.