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F e d er a l Rese r v e Ba n k
DALLAS. TEXAS

of

D allas

75222

A m e ric a n R e v o lu tio n B ic en ten n ia l

Circular No. 76-58
A p ril 12, 1976

PROGRESS REPORT ON THE BOOK-ENTRY PROCEDURE
FOR U . S . TREASURY AND FEDERAL AGENCY SECURITIES

TO ALL BANKS
AND OTHERS CONCERNED IN THE
ELEVENTH FEDERAL RESERVE DISTRICT:
A s a n n o u n c e d in p r e v i o u s c i r c u l a r s w e h a v e i s s u e d , t h e jo i n t F e d e r a l
R e s e r v e /U .S . T r e a s u r y b o o k -e n try p ro g ra m has m ade c o n s id e ra b le p r o g r e s s
s i n c e its i n a u g u r a t i o n in J a n u a r y 1968. T h e p u r p o s e o f t h i s p r o g r a m is to r e d u c e
th e u s e of d e f i n i t i v e s e c u r i t i e s to t h e f u ll e s t p o s s i b l e e x t e n t in c o n n e c tio n w ith th e
iss u a n c e , c u s to d y , a n d tr a n s f e r of m a rk e ta b le T r e a s u r y a n d A gency o b lig atio n s.
T h e b o o k - e n t r y p r o c e d u r e o f f e r s s u b s t a n t i a l b e n e f i ts to i n v e s t o r s , th e f in a n c ia l
c o m m u n it y , a n d t h e T r e a s u r y . It r e d u c e s t h e b u r d e n o f p a p e r w o r k c r e a t e d b y
th e m o u n tin g v o lu m e of p u b l i c d e b t t r a n s a c t i o n s ; it p r o t e c t s a g a i n s t lo s s , t h e f t ,
a n d c o u n t e r f e i t i n g ; a n d it s u b s t a n t i a l l y r e d u c e s th e c o s t of i s s u i n g , s t o r i n g , a n d
deliverin g T re a s u ry sec u ritie s.
At th e e n d of F e b r u a r y 1976, a total o f $299.1 b i l l i o n , r e p r e s e n t i n g
79 p e r c e n t of m a r k e t a b l e T r e a s u r y s e c u r i t i e s o u t s t a n d i n g , w a s in b o o k - e n t r y fo rm .
In a d d i t i o n , a t t h e s a m e d a t e , t h e p r o g r a m a l s o i n c l u d e d $ 4 6 .7 b illio n of e l i g i b l e
F e d e r a l A g e n c y o b l i g a t i o n s , r e p r e s e n t i n g o v e r 63 p e r c e n t of th e o u t s t a n d i n g d e b t
of t h o s e A g e n c i e s . On t h e t a b l e t h a t is p r i n t e d on o n e of th e fo llo w in g p a g e s , t h e r e
is s h o w n th e r e s p e c t i v e b o o k - e n t r y to ta ls a t e a c h y e a r - e n d fro m 1968 t h r o u g h 1975,
a n d a l s o a t t h e e n d of J a n u a r y a n d F e b r u a r y 1976.
With n e a r l y 80 p e r c e n t of t h e m a r k e t a b l e T r e a s u r y d e b t now in b o o k e n t r y fo rm , it is a p p a r e n t t h a t t h i s p r o g r a m wi l l , in tim e , s e r v e all s e c t o r s of th e
i n v e s t i n g p u b l i c , a n d m a k e it u n n e c e s s a r y to i s s u e d e f i n i t i v e s e c u r i t i e s e i t h e r on
o r i g i n a l i s s u e s , o r in c o n n e c tio n w ith s e c o n d a r y m a r k e t t r a n s a c t i o n s . In t h e
lig h t of t h i s p r o g r e s s , t h e D e p a r tm e n t of t h e T r e a s u r y h a s r e c e n t l y i s s u e d a p r e s s
r e l e a s e , w h ic h is p r i n t e d on o n e o f t h e fo llo w in g p a g e s , a s a s ta t e m e n t of its
e x p ec tatio n s for th e fu tu re c o u rs e of b o o k - e n try .
In a n e f f o r t to a c c e l e r a t e th e e x p a n s i o n of t h e b o o k - e n t r y s y s t e m , th e
F e d e r a l R e s e r v e B a n k s a r e r e q u e s t i n g all c o m m e rc ia l b a n k s a n d o t h e r f in a n c ia l
i n s t i t u t i o n s in t h e i r r e s p e c t i v e D i s t r i c t s to e f f e c t th e c o n v e r s i o n of e l i g i b l e T r e a s ­
u r y a n d A g e n c y s e c u r i t i e s in to b o o k - e n t r y f o r m , t h r o u g h m e m b e r b a n k s , a s
r a p i d l y a s f e a s i b l e . In t h i s c o n n e c t i o n , w e a r e a w a r e t h a t th e law s of s o m e s t a t e s
o r local g o v e r n m e n t s , a n d c e r t a i n r e g u l a t i o n s o f a d m i n i s t r a t i v e o r s u p e r v i s o r y

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

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2

-

agencies, currently prevent the f l application of the book-entry procedure. In
ul
order that we may be of maximum assistance in eliminating any remaining obsta­
cles to the f l use of the program, we would appreciate being advised of any
ul
circumstances of which you may be aware where legislative or other action i
s
required to overcome such difficulties. Your communications in this regard
should be addressed to C. T. Pat Powell, Manager of the Head Office Securities
Department, at (214) 651-6384.
Our joint efforts should make i possible to realize further the benefits
t
of the book-entry system by reducing the remaining definitive Treasury and
Agency securities outstanding, and thereby move forward toward a true certifi­
cate!ess system.
Sincerely yours,
T. W. Plant
First Vice President

MARCH 1976

MARKETABLE UNITED STATES TREASURY SECURITIES
AND PORTION IN BOOK-ENTRY FORM
1968 TO DATE

End of
Period

1/
Marketables
(billions)

2/
Book-Entry Holdings
System Total
__ %_
(billions)

3/
Definitive
Outstanding
(billicns)

1968

$ 236.8

$ 36.5

15.4

$ 200.3

1969

235.9

38.2

16.2

197.7

1970

247.7

121.3

48.9

126.4

1971

262.0

152.6

58.2

109.4

1972

269.5

160.2

59.4

109.3

1973

270.2

176.6

65.4

93.6

1974

281.3

201.4

71.6

79.9

1975

363.2

285.1

78.5

78.1

Jan 1976
Feb 1976

369.3
378.8

292.6
299.1

79.8
79.0

76.7
79.7

MARKETABLE GOVERNMENT AGENCY SECURITIES
AND PORTION IN BOOK-ENTRY FORM
1974
1975
Jan 1976
Feb 1976

I7
2/
3/
£/

71.9
74.4
74.2
73.4

1/

23.2
40.5
45.2
46.7

32.3
54.4
60.9
63.6

Source: Monthly Statement of the Public Debt; excludes
Federal Financing Bank for July 1974 et
seq.
Source: Treasury Department and FRB New York.
Includes both bearer and registered securities.
Source: Daily Quotation Sheets.

48.7
33.9
29.0
26.7

The Department of the TREASURY
WASHINGTON, O.C. 20220

TELEPHONE 964-2041

$

C ontact:
H . J , H in tg e n
E x t e n s io n 2427
M arch 31, 1976

FOR IMMEDIATE RELEASE

FORMATION OF A TREASURY-FEDERAL RESERVE TASK FORCE
ESTABLISHED TO EXPAND THE BOOK-ENTRY PROGRAM
OF ISSUING GOVERNMENT SECURITIES

S e c r e t a r y of th e T r e a s u r y W illiam E . S im o n t o d a y a n n o u n c e d th e
fo rm a tio n o f a T r e a s u r y - F e d e r a l R e s e r v e T a s k F o r c e , e s t a b l i s h e d to e x p a n d the
b o o k -e n tr y program of is s u in g G overnm ent s e c u r i t i e s . The S ecreta ry com ­
m e n te d th a t th e e x p a n s i o n o f t h e b o o k - e n t r y p r o g r a m o v e r the p a s t e ig h t y e a r s
h a s b e e n m o st g r a t i f y in g . At th e e n d of F e b r u a r y 1976, th e am ount of U n ite d
S t a te s T r e a s u r y b i l l s , n o t e s , a n d b o n d s in b o o k - e n t r y form r e a c h e d a l e v e l of
$299 .1 b i l l i o n or 79% of th e total m a r k e t a b le d e b t .
In itia te d i n 1968, th e b o o k - e n t r y p r o c e d u r e e lim in a t e s the i s s u a n c e
o f e n g r a v e d T r e a s u r y s e c u r i t i e s in f a v o r o f b o o k - e n t r i e s m a in ta in e d at F e d e r a l
R e s e r v e B a n k s for th e a c c o u n t s of c o m m e r c ia l b a n k s w h i c h a r e m e m b e r s of the
F e d e r a l R e s e r v e S y s t e m . T h e b o o k - e n t r y p r o c e d u r e is c u r r e n t l y a v a i la b l e to
b o th i n d i v i d u a l s and i n s t i t u t i o n s a c t in g t h r o u g h s u c h m em b e r b a n k s . T h e
b o o k - e n t r y p r o c e d u r e o f f e r s s u b s t a n t i a l b e n e f i t s to i n v e s t o r s , the f in a n c ia l
c o m m u n it y , a n d th e T r e a s u r y . It r e d u c e s th e b u r d e n of p a p e r w o r k c r e a t e d b y
the m o u n tin g v o lu m e o f p u b l i c d e b t t r a n s a c t io n s ; it p r o t e c t s a g a i n s t l o s s , th e ft ,
a n d c o u n t e r f e it i n g ; a n d it s u b s t a n t i a l l y r e d u c e s the c o s t o f i s s u i n g , s t o r i n g ,
and d e liv e r in g T r e a su r y se c u r itie s .
T h e T r e a s u r y - F e d e r a l R e s e r v e T a s k F o r c e w i l l d e s i g n a n d adopt an
e x p a n d e d b o o k - e n t r y s y s t e m w it h the u ltim a te o b j e c t i v e of c o m p le t e l y e lim in a t ­
in g the u s e of d e f i n i t i v e s e c u r i t i e s in n e w p u b li c d e b t b o r r o w i n g s . D u r in g the
c o u r s e o f th is e f f o r t , th e v i e w s an d co m m e n ts o f th e f in a n c ia l c o m m u n ity a n d
o th e r i n t e r e s t e d p a r t i e s w i l l b e s o l i c i t e d .

oOo

WS-756


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102