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Term Investment Option

Overview

The Term Investment Option (TIO) is an investment opportunity offered to Treasury Tax and Loan (TT&L) participants. Treasury will frequently auction excess operating funds to participants for a fixed term and rate determined through a competitive bidding process.

The Treasury strives to give participants as much advance notice of an auction as possible. Treasury generally follows the following timeline:

Day One: Update Notification - E-mail with general intent notice sent to participants one day prior to official announcement.
Day Two: Announcement - E-mail sent to participants containing the offering amount, length of term and acceptable collateral (usually 9:30am ET).
Day Two (Continued): Auction - Participants place bids in TERMLink® by cutoff time (usually 11:00am ET). Results announced on TERMLink within 10 to 20 minutes.
Day Three: Settlement - Awardees pledge collateral to TIO account by 12:00pm ET. Awarded funds are received by 2:00pm ET.
Maturity Day - Funds are returned by awardees and interest is charged and collected by Treasury.

Treasury may vary the auction process by expanding or compressing these time frames in order to more effectively manage the government's cash balances. This may include (1) eliminating the update, (2) updating and announcing the auction on the same day or (3) announcing the auction one day prior to the auction. Treasury may also vary the auction close time.

TERMLink® is Treasury's official Internet-based application for institutions participating in TIO auctions.

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