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FED ER AL RESERVE BANK O F NEW YORK Fiscal Agent of the United States rC ircular L No. 6 9 3 9-| Q 72? M ay 0 9 , 1197 J OFFERING OF TWO SERIES OF TREASURY BILLS $2,300,000,000 of 91-Day Bills, Additional Amount, Series Dated February 17,1972, Due August 17,1972 (To Be Issued May 18, 1972) $1,800,000,000 of 182-Day Bills, Dated May 18, 1972, Due November 16, 1972 To A ll Incorporated B anks and T rust 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 T reasury Departm ent, by this public notice, invites tenders for two series of T reasury bills to the aggregate amount of $4,100,000,000, or thereabouts, for cash and in exchange for T reasury bills m aturing M ay 18, 1972, in the amount of $4,211,555,000, as follow s: 91-day bills (to m aturity date) to be issued May 18, 1972, in the amount of $2,300,000,000, or thereabouts, representing an additional amount of bills dated F ebru ary 17, 1972, and to mature A ugust 17, 1972 (C U S IP No. 912793 N Z 5), originally issued in the amount of $1,800,540,000, the additional and original bills to be freely interchangeable. 182-day bills, for $1,800,000,000, or thereabouts, to be dated May 18, 1972, and to mature November 16, 1972 (C U S IP No. 912793 P M 2 ). The bills of both series will be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided, and at m aturity 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 (m aturity value). Tenders will be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., E astern Daylight Saving time, Monday, May 15, 1972. Tenders will not be received at the T reasury Departm ent, W ashington. Each tender must be for a minimum of $10,000. Tenders over $10,000 must be in m ulti ples of $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. O thers 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 of 2 percent of the face amount of T reasury bills applied for, unless the tenders are accompanied by an express guaranty of payment by an incorporated bank or tru st 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 T reasury D epartm ent of the amount and price range of accepted bids. Only those submitting competitive tenders will be advised of the acceptance or rejection thereof. The Secretary of the T reasury 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. Settlem ent for accepted tenders in accordance with the bids must be made or completed at the Federal Reserve Bank on May 18, 1972, in cash or other im mediately available funds or in a like face amount of T reasury bills m aturing May 18, 1972. Cash and exchange tenders will receive equal treatm ent. Cash adjustm ents will be made for dif ferences between the par value of m aturing bills accepted in ex change and the issue price of the new bills. U nder 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 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 of T reasury bills (other than life insurance companies) issued hereunder must include in his income tax return, as ordinary gain or loss, the dif ference between the price paid for the bills, w hether on original issue or on subsequent purchase, and the amount actually received either upon sale or redemption at m aturity during the taxable year for which the return is made. T reasury D epartm ent C ircular No. 418 (current revision) and this notice prescribe the terms of the T reasury 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 Daylight Saving time, Monday, May 15, 1972, 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 immedi ately available funds or in maturing Treasury bills. Results of the last weekly offering of Treasury bills (91-day bills to be issued May 11, 1972, representing an additional amount of bills dated February 10, 1972, maturing August 10, 1972; and 182-day bills dated May 11, 1972, maturing November 9, 1972) 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 MAY 11, 1972) Range of Accepted Competitive Bids 9 1 -Day Treasury Bills Maturing August 10 , 1972 Price 18 2 -Day Treasury Bills Maturing November 9, 1972 A pprox. equiv. annual rate Price A pprox. equiv. annual rate High .............................................. 99.139 3.406% 98.031 3.895% Low ................................................ 99.115 3.501% 98.004 3.948% A verage.......................................... 99.125 3.462%x 98.025 3.907%! 1 These rates are on a bank discount basis. The equivalent coupon issue yields are 3.54% for the 91-day bills, and 4.04% for the 182-day bills. (73 percent of the amount of 91-day bills bid for at the low price was accepted.) (61 percent 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) 9 1 -Day Treasury Bills Maturing August 10 , 1972 D istrict Applied for Boston ......................... ........... $ 22,260,000 182 -Day Treasury Bills Maturing November 9, 1972 Accepted $ 7,260,000 Applied for $ 18,350,000 Accepted $ 3,350,000 New York ................... ........... 3,086,075,000 1,952,575,000 2,544,840,000 1,465,675,000 Philadelphia ................. ........... 11,565,000 11,565,000 26,250,000 6,250,000 Cleveland ..................... ........... 18,035,000 17,970,000 8,040,000 7,890,000 Richmond ..................... ........... 8,110,000 8,110,000 11,050,000 3,660,000 Atlanta ......................... ........... 38,590,000 22,525,000 36,555,000 11,165,000 291,485,000 142,515,000 327,945,000 223,255,000 50,005,000 41,465,000 27,645,000 16,755,000 20,435,000 Chicago ....................... ........... St. Louis ...................... ........... Minneapolis .................. ........... 31,945,000 24,855,000 28,825,000 Kansas City .................. ........... 30,945,000 19,745,000 23,770,000 7,770,000 Dallas ............................ ........... 27,465,000 13,130,000 21,745,000 5,545,000 San Francisco ............. ........... 99,915,000 38,640,000 104,660,000 28,410,000 ........... $3,716,395,000 T otal .................. $2,300,355,000a $3,179,675,000 a Includes $168,745,000 noncompetitive tenders accepted at the average price of 99.125. b Includes $72,870,000 noncompetitive tenders accepted at the average price of 98.025. $1,800,160,000b