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F E D E R A L R E S E R V E BANK O F N E W YORK Fiscal Agent of the United States No. 6 7 0 1 1J rCircular L March 23,1971 OFFERING OF TWO SERIES OF TREASURY BILLS $1,900,000,000 of 91-Day Bills, Additional Amount, Series Dated December 31, 1970, Due July 1, 1971 (To Be Issued April 1, 1971) $1,600,000,000 of 182-Day Bills, Additional Amount, Series Dated Sept. 30, 1970, Due Sept. 30, 1971 (To Be Issued April 1, 1971) To A ll Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve D istrict: Following is the text of a notice issued by the Treasury Department, released at 4 p.m. today: The Treasury Department, by this public notice, invites tenders for two series o f Treasury bills to the aggregate amount of $3,500,000,000, or thereabouts, for cash and in exchange for Treasury bills maturing April 1, 1971, in the amount o f $3,305,065,000, as follow s: 91-day bills (to maturity date) to be issued April 1, 1971, in the amount o f $1,900,000,000, or thereabouts, representing an additional amount o f bills dated Decem ber 31, 1970, and to mature July 1, 1971 (C U S IP No. 912793 K Q 8), originally issued in the amount of $1,402,020,000 (an additional $200,745,000 was issued Februray 26, 1971), the additional and original bills to be freely interchangeable. 182-day bills (to maturity date) to be issued April 1, 1971, in the amount o f $1,600,000,000, or thereabouts, repre senting an additional amount o f bills dated September 30, 1970, and to mature September 30, 1971, (C U S IP No. 912793 K S 4 ), originally issued in the amount o f $1,202,480,000 (an additional $500,550,000 was issued December 31, 1970), the additional and original bills to be freely interchangeable. The bills of both series will be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided, and at maturity their face amount will be payable without interest. They will be issued in bearer form only, and in denominations of $10,000, $15,000, $50,000, $100,000, $500,000 and $1,000,000 (maturity value). Tenders will be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern Stand ard time, Monday, March 29, 1971. Tenders will not be received at the Treasury Department, Washington. Each tender must be for a minimum of $10,000. Tenders over $10,000 must be in multi ples o f $5,000. In the case of competitive 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 Reserve 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 per mitted 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 invest ment securities. Tenders from others must be accompanied by payment o f 2 percent of the face amount o f Treasury bills applied for, unless the tenders are accompanied by an express guaranty of payment by an incorporated bank or trust company. Immediately after the closing hour, tenders will be opened at the Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department o f the amount and price range of accepted bids. Only those submitting competitive tenders will be advised of the acceptance or rejection thereof. The Secretary o f the Treasury expressly reserves the right to accept or reject any or all tenders, in whole or in part, and his action in any such respect shall be final. Subject to these reservations, noncompetitive tenders for each issue for $200,000 or less without stated price from any one bidder will be accepted in full at the average price (in three decimals) of accepted competi tive bids for the respective issues. Settlement for accepted tenders in accordance with the bids must be made or completed at the Federal Reserve Bank on April 1, 1971, in cash or other im mediately available funds or in a like face amount o f Treasury bills maturing April 1, 1971. Cash and exchange tenders will receive equal treatment. Cash adjustments will be made for d if ferences between the par value of maturing bills accepted in ex change and the issue price o f the new bills. Under Sections 454(b) and 1221(5) o f the Internal Revenue Code o f 1954, the amount o f discount at which bills issued here under are sold is considered to accrue when the bills are sold, re deemed or otherwise disposed of, and the bills are excluded from consideration as capital assets. Accordingly, the owner o f Treasury bills (other than life insurance companies) issued hereunder must include in his income tax return, as ordinary gain or loss, the difference between the price paid for the 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. Treasury Department Circular No. 418 (current revision) and this notice prescribe the terms o f the Treasury bills and govern the conditions of their issue. Copies of the circular may be ob tained 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, March 29, 1971, 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 the enclosed envelope marked “ Tender for Treasury Bills (W eekly).” Tenders not requiring a deposit may be submitted by telegraph, subject to written confirmation; no tenders may be submitted by telephone. Payment for the Treasury bills cannot be made by credit through the Treasury Tax and Loan Account. Settlement must be made in cash or other immediately available funds or in maturing Treasury bills. Results of the last weekly offering o f Treasury bills ( 9 1 -day bills to be issued March 25, 1971, representing an additional amount of bills dated December 24, 1970, maturing June 24, 1 9 7 1 ; and 182-day bills dated M arch 25, 1971, maturing September 23, 1971) are shown on the reverse side of this circular. A lfred H ayes, President. ( over ) RESULTS OF LAST WEEKLY OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED MARCH 25, 1971) Range of Accepted Competitive Bids 91-Day Treasury Bills Maturing June 24,1971 182-Day Treasury Bills Maturing September 23,1971 Price Approx. equiv. annual rate Price Approx. equiv. annual rate High .......................... ................ 99.177 3.256% 98.265 3.432% Low .......................... ................ 99.146 3.378% 98.211 3.539% 99.158 3.331%* 98.240 3.481 % l Average .................... ................ 1 These rates are on a bank discount basis. 3.60 percent for the 182-day bills. The equivalent coupon issue yields are 3.42 percent for the 91-day bills, and (93% o f the amount of 91-day bills bid for at the low price was accepted.) (41% of the amount of 182-day bills bid for at the low price was accepted.) Total Tenders Applied for and Accepted (By Federal Reserve Districts) 91-Day Treasury Bills Maturing June 24,1971 Accepted A pplied fo r District B o s to n .......................... .............. $ 23,390,000 182-Day Treasury Bills Maturing September 23, 1971 $ 13,390,000 Applied fo r $ 12,370,000 Accepted $ 2,370,000 New York .................. .............. 2,380,245,000 1,452,545,000 2,215,960,000 1,299,280,000 Philadelphia ................ .............. 37,135,000 22,135,000 12,525,000 12,525,000 Cleveland .................... .............. 43,150,000 41,150,000 26,820,000 26,820,000 Richmond .................... .............. 10,355,000 10,355,000 2,955,000 2,955,000 Atlanta ........................ .............. 47,145,000 41,145,000 31,960,000 25,255,000 Chicago ........................ .............. 172,160,000 116,460,000 133,580,000 97,680,000 St. L o u is ...................... .............. 44,540,000 43,540,000 20,450,000 17,450,000 ................ .............. 30,510,000 23,510,000 43,200,000 38,200,000 Kansas City ................ .............. 40,335,000 40,335,000 15,665,000 15,665,000 .......................... .............. 28,345,000 21,205,000 25,665,000 19,665,000 San F ran cisco.............. .............. 101,595,000 74,245,000 104,855,000 42,375,000 .............. $2,958,905,000 $1,900,015,000* $2,646,005,000 Minneapolis Dallas T otal ...................... a Includes $255,905,000 noncompetitive tenders accepted at the average price o f 99.158. b Includes $ 94,960,000 noncompetitive tenders accepted at the average price o f 98.240. $ 1,600,240,000b
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