BANKING & FINANCE - Feb. 21, 1996

Short-Term T-Bills Mixed: The Treasury Department sold $13.3 billion in three-month bills at an average discount rate of 4.78%, down from 4.80% last week. About $13.2 billion was sold in six-month bills at an average discount rate of 4.75%, up from 4.71%. The three-month bill rate was the lowest since they sold for 4.61% on Sept. 19, 1994. The six-month rate was the highest since they averaged 4.79% on Feb. 5. The effective yields: 4.92% on the three-month bills, with a $10,000 bill selling for $9,879.20, and 4.95% on the six-month bill, priced at $9,759.90. However, the auction took place before market yields rocketed Tuesday and left T-bill yields sharply higher at the end of trading. Meanwhile, the Treasury said it will sell two-year and five-year notes on Feb. 27 and 28, respectively.