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F ed era l R eserv e Bank of Dallas F I S C A L A G E N T O F T H E U N IT E D S T A T E S DALLAS, TEXAS 75222 Circular No. 70-175 Ju ly 22, 1970 NEW OFFERING — TREASURY BILLS To All Banking Institutions a n d Others Concerned in the Eleventh Federal Reserve District: Your attention is invited to the following statement giving details of two issues of Treasury bills: T h e T reasury D epartm ent, by this public notice, invites tenders for two series of T reasury bills to the aggregate am ount of $3,100,000,000, or thereabouts, for cash and in exchange for T reasury bills m aturing Ju ly 30, 1970, in the am ount of $3,001,595,000, as follows: 91-DAY B IL L S (to m aturity d ate) to be issued Ju ly 30, 1970, in the am ount of $1,800,000,000, or thereabouts, representing an additional am ount of bills dated A pril 30, 1970 and to m ature October 29, 1970, originally issued in the am ount of $1,301,230,000, the additional and original bills to be freely interchangeable. 182-DAY B IL L S for $1,300,000,000, or thereabouts, to be dated Ju ly 30, 1970, and to m ature January 28, 1971. T he bills of both series will be issued on a discount basis under com petitive and noncom petitive bidding as hereinafter provided, and a t m aturity their face am ount will be payable w ithout interest. T hey will be issued in bearer form only, and in denom inations of $10,000, $50,000, $100,000, $500,000 and $1,000,000 (m atu rity value). T enders will be received a t Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., E astern D aylight Saving Tim e, M onday, July 27, 1970. T enders will not be received a t the Treasury D epartm ent, W ashington. Each tender m ust be for an even m ultiple of $10,000, and in th e case of com petitive tenders the price offered m ust be expressed on th e basis of 100, with not more than three decimals, e.g., 99.925. Fractions m ay not be used. It is urged th a t tenders be m ade on th e printed forms and forwarded in th e special envelopes which will be supplied by Federal Reserve Banks or Branches on application therefor. Banking institutions generally m ay subm it 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 perm itted to subm it tenders except for th eir own account. T enders will be received w ithout deposit from incorporated banks and tru st companies and from responsible and recognized dealers in investm ent securities. Tenders from others m ust be accom panied by paym ent of 2 percent of the face am ount of T reasury bills applied for, unless the tenders are accom panied by an express guaranty of paym ent by an incorporated bank or tru st company. Im m ediately after the closing hour, tenders will be opened a t the Federal Reserve Banks and Branches, following which public announcem ent will be made by the T reasury D epartm ent of the am ount and price range of accepted bids. Only those subm itting com petitive tenders will be advised of the acceptance or rejection thereof. T he Secretary of 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. Sub ject 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 a t the average price (in three decimals) of accepted com petitive bids for th e respective issues. S ettlem ent for accepted tenders in accordance with the bids m ust be m ade or com pleted a t the Federal Reserve B ank on Ju ly 30, 1970, in cash or other im m ediately available funds or in a like face am ount of T reasury bills m aturing Ju ly 30, 1970. Cash and exchange tenders will receive equal treatm ent. Cash adjustm ents will be m ade for differences between the p ar value of m atu r ing bills accepted in exchange and the issue price of the new bills. T h e income derived from T reasury bills, w hether 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 T reasury bills does not have any special treatm ent, as such, under the Internal Revenue Code of 1954. T he bills are subject to estate, inheritance, gift or other excise taxes, whether Federal or State, but are exem pt from all taxation now or hereafter imposed on the principal or interest thereof by any State, or any of the possessions of the United States, or by any local taxing authority. For purposes of taxation the am ount of discount a t which T reasury bills are originally sold by the U nited States is considered to be interest. U nder Sections 454 (b ) and 1221 (5 ) of the Internal Revenue Code of 1954 the am ount of discount a t which bills issued hereunder are sold is not con sidered to accrue until such bills are sold, redeem ed or otherwise disposed of, and such bills are excluded from consideration as capital assets. Accordingly, th e owner of Treasury bills (o th er th an life insurance com panies) issued hereunder need include in his income tax return only the difference between the price paid for such bills, w hether on original issue or on subsequent purchase, and the am ount actually received either upon sale or redem ption a t m aturity during the taxable year for which the return is made, as ordinary gain or loss. T reasury D epartm ent Circular No. 418 (cu rrent revision) and this notice, prescribe the term s 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. In accordance with the above announcement, tenders will be received at this bank an d its branches at El Paso, Houston and San Antonio up to twelve-thirty p.m., Central Daylight Saving Time, Monday, July 27, 1970. Tenders may H be entered by telephone. ot Yours very truly, P. E. Coldwell _______________ President LAST PREVIOUS OFFERING OF TREASURY BILLS Amount, Range and A pproxim ate Yield of A ccepted T enders 91-Day Bills 182-Day Bills D ue O ctober 22, 1970 D ue Jan uary 21, 1971 $3,012,850,000_______________________________T otal Applied F or-----------------------------------------------$2,457,660,000 $ 1,800,720,000________________________________ T otal A ccepted------------------------------------------------ $ 1,300,100,000 P rice Y ield P rice Y ield 98.393 6.357% _________________________ H ig h __________________ 96.754_____ I ? ____6.421% 98.381 6.405% -------------------------------------- Low------ -------------------------- 96.740___________ 6.448% 98.386 6.385% ( 1 ) ------------------------------ Average____________________ 96.743___________ 6.442% (1 ) ( 1 ) These ra te s are on a b a n k discount basis. T h e equivalen t coupon issue yields are 6 .5 8 % for th e 91-day bills and 6 .7 5 % for th e 182-day bills. (See reverse for tender form) This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) TENDER FOR TREASURY BILLS 182 DAYS TO MATURITY Dated July 30,1970 Maturing January 28,1971 To: Federal Reserve Bank, Station K, Dallas, Texas 75222 or — The ________________________ Branch El Paso 79999 Houston 77001 San Antonio 78206 (D ate) Pursuant to the provisions of Treasury Department Circular No. 418 (current revision) and the provisions of th e public announcement issued by the Treasury Department, the undersigned offers to purchase Treasury bills in the amount shown below, and agrees to pay for the amount allotted, on or before the issue date, by the method and at the rate indicated. NONCOMPETITIVE TENDER $____________________________________ NOT TO EXCEED $200,000 Noncompetitive tenders for $200,000 or less from any one bidder, without stated price, will be accepted in full at the average price (in three decimals) of accepted competitive bids. COMPETITIVE TENDERS >$. _@_ $_________________________ Prices should be e x T___________________________ pressed on the basis of 100, with not more than -------------------------------------th ree d ecim als p la c e s e. g., 99.925. Fractions « -------------------------------------P must not be used. mSr* TENDERS MAY NOT BE ACCEPTED BY TELEPHONE. TENDERS BY WIRE, IF RECEIVED BEFORE TH E CLOSING HOUR, ARE ACCEPTABLE. Denominations Desired N um ber of Pieces Payment for this issue of bills cannot be made by credit to Treasury Tax and Loan Account. METHOD OF PAYMENT M atu rity V alue _@ $ 10,000 $_ $ 50,000 $_ □ □ $ 100,000 $_ By maturing bills held by__________________________ Payment to be made by_________ _ _@$ 500,000$ □ Charge our reserve account on payment date I I Draft enclosed (E ffectual delivery of enclosed d r a f t . < > $1,000,000 $_ § Delivery Instructions: □ Hold in Custody Account—Member banks for own account only □ Pledge to secure Treasury Tax and Loan Account □ Ship to------------------------------------- shall be on la te st day w hich will p e rm it p re s e n tm e n t in o rd er to o b ta in irrevocably collected fu n d s on p a y m e n t d ate) (S u b sc rib e r’s fu ll nam e o r co rp o ra te title ) (A ddress) By(A uthorized official s ig n a tu re an d title ) (F o r the acco u n t of, if te n d e r is fo r a n o th e r subscriber) (A ddress) IMPORTANT 1. No tender for less than $10,000 will be considered and each tender must be for an amount in multiples of $10,000 (m aturity value). 2. Tenders should be forwarded in an envelope clearly addressed to this bank or appropriate branch as Fiscal Agent of the United States, with notation on the envelope reading “TENDER FOR TREASURY OFFERING”. Since envelopes received with this legend will not be opened until after the closing time specified in the public announcement, communi cations relating to other matters should not be enclosed. Envelopes for submitting tenders may be obtained from th is bank or appropriate branch. 3. Any qualified or conditional tender will be rejected. 4. If a corporation makes the tender, the form should be signed by an officer of the corporation authorized to make th e tender and the signing of the form by an officer of the corporation will be construed as a representation by him that he has been so authorized. If the tender is made by a partnership it should be signed by a member of the firm, who should sign in the form “___________________________ , a copartnership, by ________ a member of the firm.” 5. Tenders from those other than incorporated banks and trust companies or responsible and recognized dealers in in vest ment securities will be disregarded, unless accompanied by a deposit of 2 percent of the total amount (maturity valu e) of the Treasury bills applied for, or unless the tenders are accompanied by an express guaranty of full payment by an incorporated bank or trust company. 6. If the language of this form is changed in any respect, which, in the opinion of the Secretary of the Treasury is material, the tender may be disregarded. (See reverse for announcement)