FAQs for Floating Rate Notes

January 2014

2 years.

We auction FRNs each month, with original issues in January, April, July, and October, and reopenings in the other months.

In a reopening, we auction additional amounts of a previously issued security. A reopened FRN has the same maturity date and spread as the original FRN, but a different issue date and usually a different price.

When you buy a reopened security, you pay a premium if the price of the security at reopening is greater than the face value of the security. The price of the reopened security is determined at auction. Because the security is being auctioned at different times, market conditions probably won't be the same and, therefore, the prices likely won't be the same either.

Also, when you buy a reopened security, regardless of its price, you may have to pay accrued interest--interest the security earns from the original dated date of the security until the date the security is issued to you. However, we pay the accrued interest back to you in your first interest payment.

To place a competitive bid, you must use a broker, dealer, or financial institution. (TreasuryDirect allows only noncompetitive bids.)