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FEDERAL RESERVE BANK OF N EW YORK Fiscal Agent of the United States J" Circular No. 6 0 5 7 ~l L November 8, 1967 J OFFERING OF TWO SERIES OF TREASURY BILLS ,500,000,000 of 91-Day Bills, Additional Amount, Series Dated August 17,1967, Due February 15,1968 (To Be Issued November 16, 1967) $1,000,000,000 of 182-Day Bills, Dated November 16, 1967, Due May 16, 1968 To A ll Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve D istrict: hollowing is the text of a notice issued by the Treasury Department, released for publication today at 4 p.m., Eastern Standard tim e: The Treasury Department, by this public notice, invites tenders for two series of Treasury bills to the aggregate amount of $2,500,000,000, or thereabouts, for cash and in exchange for Treasury bills maturing N ovem ber 16, 1967, in the amount of $2,400,412,000, as follow s: 91-day bills (to maturity date) to be issued N ovem ber 16, 1967, in the amount of $1,500,000,000, or thereabouts, representing an additional amount of bills dated A ugust 17, 1967, and to mature February 15, 1968, originally issued in the amount of $1,000,569,000, the additional and original bills to be freely interchangeable. ] 82-day bills, for $1,000,000,000, or thereabouts, to be dated Novem ber 16, 1967, and to mature May 16, 1968. T he bills of both series will be issued on a discount basis under com petitive and noncom petitive bidding as hereinafter provided, and at maturity their face amount will be payable without interest. T hey will be issued in bearer form only, and in denominations of $1,000, $5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000 (m aturity value). Tenders will be received at Federal R eserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern Stand ard time, Monday, N ovem ber 13, 1967. Tenders will not be received at the Treasury Department, W ashington. Each tender must be for an even multiple of $1,000, and in the case of com petitive tenders^ the price offered must be expressed on the basis of 100, with not more than three decimals, e.g., 99.925. Fractions may not be used. It is urged that tenders be made on the printed forms and forwarded in the special envelopes which will be supplied by Federal R eserve Banks or Branches on application therefor. Banking institutions generally may submit tenders for account of customers, provided the names of the customers are set forth in such tenders. Others than banking institutions will not be permitted to submit tenders except for their own account. Tenders will be received without deposit from incorporated banks and trust companies and from responsible and recognized dealers in investm ent securities. Tenders from others must be accompanied by payment of 2 percent of the face amount of Treasury bills applied for, unless the tenders are accompanied by an express guaranty of paym ent by an incorporated bank or trust company. Im m ediately after the closing hour, tenders will be opened at the Federal R eserve Banks and Branches, follow ing which public announcement will be made by the Treasury Departm ent of the amount and price range of accepted bids. T hose sub m itting tenders w ill be advised of the acceptance or rejection thereof. The Secretary of the Treasury expressly reserves the right to accept or reject any or all tenders, in w hole or in part, and his action in any such respect shall be final. Subject to these reservations, noncom petitive tenders for each issue for $200,000 or less w ithout stated price from any one bidder will be accepted in full at the average price (in three decim als) of accepted com petitive bids for the respective issues. Settlem ent for accepted tenders in accordance with the bids must be made or completed at the Federal Reserve Bank on N ovem ber 16, 1967, in cash or other im m ediately available funds or in a like face amount of Treasury bills maturing N ovem ber 16, 1967. Cash and exchange tenders will receive equal treatment. Cash adjustm ents will be made for differences between the par value of maturing bills accepted in exchange and the issue price of the new bills. The incom e derived from Treasury bills, whether interest or gain from the sale or other disposition of the bills, does not have any exemption, as such, and loss from the sale or other disposition of Treasury bills does not have any special treat ment, as such, under the Internal Revenue Code of 1954. The bills are subject to estate, inheritance, gift or other excise taxes, whether Federal or State, but are exem pt from all taxa tion now or hereafter im posed on the principal or interest thereof by any State, or any of the possessions of the U nited States, or by any local taxing authority. For purposes of taxation the amount of discount at which Treasury bills are originally sold by the U nited States is considered to be interest Under Sections 454(b) and 1221(5) of the Internal Revenue Code of 1954, the amount of discount at which bills issued here under are sold is not considered to accrue until such bills are sold, redeemed or otherwise disposed of, and such bills are excluded from consideration as capital assets. A ccordingly, the owner of Treasury bills (other than life insurance com panies) issued hereunder need include in his incom e tax return only the difference between the price paid for such bills, whether on original issue or on subsequent purchase, and the amount actually received either upon sale or redemption at maturity during the taxable year for which the return is made, as ordi nary gain or loss. Treasury Departm ent Circular N o. 418 (current revision) and this notice prescribe the terms of the Treasury bills and govern the conditions of their issue. Copies of the circular may be obtained from any Federal Reserve Bank or Branch. This Bank will receive tenders for both series up to 1 :30 p.m., Eastern Standard time, Monday, November 13 1967, at the Securities Department of its Head Office and at its Buffalo Branch. Tender forms for the respective series are enclosed. Please use the appropriate forms to submit tenders and return them in an envelope marked “Tender for Treasury Bills.” Tenders may be submitted by telegraph, subject to written confirmation; they may not be submitted by telephone. Paym ent for the Treasury bills cannot be made by credit through the Treasury T a r and Loan Account. Settlem ent must be made in cash or other immediately available funds or in maturing Treasury bills Results of the last weekly offering of Treasury bills (91-day bills to be issued November 9, 1967 representing an additional amount of bills dated August 10, 1967, maturing February 8, 1968; and 182-day bills dated N ovem ber 9, 1967, maturing May 9, 1968) are shown on the reverse side of this circular. A lfred H ayes, President. (o v e r) RESULTS OF LAST W EEK L Y OFFERING OF TREASURY BILLS (TW O SERIES TO BE ISSUED NOVEM BER 9, 1967) Range of Accepted Com petitive Bids 91-Day Treasury Bills M aturing February 8 , 1968 182-Day Treasury Bills M aturing M ay 9,1968 Approx. equiv. annual rate Price Approx. equiv. annual rate 98.827“ 4.640% 97.406 5.131% .......................... ............. 98.814 4.692% 97.369 5.204% Average ................... ............. 98.819 4.672%! 97.381 5.180%! Price H i g h .......................... ............. Low a E xcepting one tender of $100,000. 1 T hese rates are on a bank discount basis. T he equivalent coupon issue yields are 4.81 percent for the 91-day bills, and 5.41 percent for the 182-day bills. (96 percent of the amount of 91-day bills bid for at the low price was accepted.) (77 percent of the amount of 182-day bills bid for at the low price was accepted.) T otal Tenders A pplied for and A ccepted (By F ederal Reserve Districts) 91-Day Treasury Bills M aturing February 8,1968 ........... $ 19,126,000 Applied for Accepted Applied, for D istrict 182-Day Treasury Bills M aturing M ay 9,1968 $ 9,076,000 $ 13,216,000 Accepted $ 3,216,000 ........... 1,746,180,000 1,135,580,000 1,314,583,000 703,833,000 Philadelphia ................. ........... 24,148,000 12,148,000 16,880,000 8,880,000 ...................... ........... 52,130,000 31,078,000 26,476,000 25,326,000 Richmond ...................... ........... 21,562,000 12,562,000 8,052,000 6,822,000 .......................... ........... 37,455,000 23,655,000 22,010,000 14,010,000 Chicago .......................... ........... 203,491,000 118,157,000 147,881,000 76,881,000 St. L o u i s ........................ ........... 36,339,000 23,899,000 26,691,000 22,691,000 ................. ........... 22,130,000 12,750,000 16,797,000 9,797,000 Kansas City ................. ........... 21,073,000 20,573,000 13,431,000 13,431,000 ............................ ........... 23,544,000 13,544,000 23,693,000 15,693,000 ............. 174,101,000 88,121,000 126,662,000 99,662,000 T o tal .................. $2,381,279,000 Cleveland Atlanta Minneapolis Dallas San Francisco $1,501,143,000b $1,756,372,000 b Includes $222,007,000 noncompetitive tenders accepted at the average price of 98.819. c Includes $132,922,000 noncompetitive tenders accepted at the average price of 97.381. $ 1,000,242,000c
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