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F ed er a l r e s e r v e b a n k o f D alla s 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. 71-27 January 26, 1971 NEW OFFERING — TREASURY BILLS To All Banking Institutions and Others Concerned in the Eleventh Federal Reserve District: Your attention is invited to the following statement giving details of two issues of Treasury bills: The Treasury Department, by this public notice, invites tenders for two series of Treasury bills to the aggregate amount of $3,400,000,000, or thereabouts, for cash and in exchange for Treasury bills maturing February 4, 1971, in the amount of $3,430,045,000, as follows: 91-DAY BILLS (to maturity date) to be issued February 4, 1971, in the amount of $2,000,000,000, or there abouts, representing an additional amount of bills dated November 5, 1970, and to mature May 6, 1971 (C USIP No. 912793 K G 0), originally issued in the amount of $1,402,410,000, the additional and original bills to be freely interchangeable. 182-DAY BILLS for $1,400,000,000, or thereabouts, to be dated February 4, 1971, and to mature August 5, 1971 (CUSIP No. 912793 LC8). 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 Standard Time, Monday, February 1, 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 multiples 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. 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 investment 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 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 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 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, 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 competitive 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 February 4, 1971, in cash or other immediately available funds or in a like face amount of Treasury bills maturing February 4, 1971. Cash and exchange tenders will receive equal treatment. Cash adjustments will be made for differences between the par value of matur ing bills accepted in exchange and the issue price of the new bills. Under Sections 454 (b ) and 1221 (5 ) of the Internal Revenue Code of 1954 the amount of discount at which bills issued hereunder are sold is considered to accrue when the bills are sold, redeemed or otherwise disposed of, and the bills are excluded from consideration as capital assets. Accordingly, the owner of Treasury bills (other than life insurance companies) issued here under 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 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 and its branches at El Paso, Houston and San Antonio up to twelve-thirty p.m., Central Standard Time, Monday, February 1, 1971. Tenders may not be entered by telephone. Yours very truly, P. E. Coldwell President LAST PREVIOUS OFFERING OF TREASURY BILLS Amount, Range and Approximate Yield of Accepted Tenders 91-Day Bills 182-Day Bills Due April 29, 1971 Due July 29, 1971 $2,945,130,000 Total Applied For— ___________________________ $2,343,000,000 $2,000,015,000________________________________ Total Accepted_____ _ $1,400,140,000 Price Yield Price Yield 98.948 4.162 %_________________________High_____________________ 97.887___________ 4.180 % 98.930 4.233% _________________________ l o w ______________________97.845___________ 4.263% 98.938 4.201% ( 1 ) ____________________ Average____________________ 97.859___________ 4.235% (1 ) ( 1 ) T hese rates are on a bank discount basis. T h e equ iv alent coupon issue yields are 4 .3 1 % for th e 91-day bills and 4 .3 9 % for 182-day bills. the (S ee 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 February 4, 1971 Maturing August 5,1971 To: Federal Reserve Bank, Station K, Dallas, Texas 75222 or — The_________________________ Branch E Paso 79999 Houston 770 l 01 San Antonio 78206 (D ate) Pursuant t t p o i i n o Treasury Department C r u a No. 418 ( u r n r v s o ) and t e p o i i n of the o he r v s o s f iclr cr e t eiin h rvsos p b i announcement i s e by t e Treasury Department, t e undersigned o f r t purchase Treasury bls i t e amount ulc sud h h fes o il n h shown b l w and agrees t pay f r t e amount a l t e , on o b f r t e i s e d t , by t e method and a t e r t indicated. eo, o o h lotd r e o e h s u ae h t h ae NONCOMPETITIVE TENDER $_________________________________ -NOT TO EXCEED $200,000 Noncompetitive t n e s f r $200,000 o l s from any one b d e , without s a e p i e w l be ac ep e i f l a t e average edr o r es idr t t d rc, il c t d n ul t h p i e ( n t r e d i a s o a c pt d c m e t e b d . r c i h e ec m l ) f c e e o p ti iv i s $__________________ P i e s o dbe ex r c s h ul -@ p s ed on t e b re s h asis o f $ 1 0 with not more than 0, COMPETITIVE TENDERS >$. * three decimal places e. g., 99.925. Fraction^ V---------------must not be u e . sd TENDERS MAY NOT BE ACCEPTED BY TELEPHONE. TENDERS BY WIRE, IF RECEIVED BEFORE THF CLOSING HOUR, ARE ACCEPTABLE. ^ Denominations Desired Payment f r t i i s e o bls cannot be made by o h s s u f il Number of c e i t Treasury Tax and Loan Account. rdt o " pieces M aturity V alue METHOD OF PAYMENT .< ? §> 10,000 ?□ By maturing bills 15,000 ?@ ? held by__________________________ _ @ $ 50,000 $□ Payment to be made by--------------------@ $ 100,000 $. □ @ * 500,000 t @ $1.,000,000 Delivery Instructions: □ Hold in Custody Account— Member banks for own account only □ Pledge to secure Treasury Tax and Loan Account □ Shipto________________________ Charge our reserve account on payment date Draft enclosed (Effectual delivery o f .ncloMKi d r » ft □ shall be on latest day which w ill perm it p resen tm en t in order to obtain irrevocably collected funds on p a y m en t date) ~ (Subscriber’s fu ll nam e or corporate title) (Address) By (Authorised official signature and title) (For the aecount of, if tender is for another subscriber) (Address) IMPORTANT 1 No t . ender f r l s than $ 0 0 0 will be c n i e e and each t n o $ 0 0 0 must be f r an amount i multiples o o es 1,0 osdrd e der ver 1 , 0 o n f $ , 0 (maturity v l e . 500 au) 2 Tenders s o ld be forwarded i an e . hu n nvelope c e r y addressed t t i bank o a lal o hs r ppropriate branch a F s a Agent of t * s icl h» United S a e , with n t t o on th e v tts oain e n elope reading “TENDER FOR TREASURY OFFERING”. S n e envelopes ic r c i e with t i legend w l not be opened u t l a t r t e c o i g time s e i i d i t e p b i announcement, communi. eevd hs il ni f e h l s n pcfe n h u l c c t o s r l t n t o h r matters s u no be e c o e . Envelopes f r submitting t n e s may be o a n d from t i ain eaig o te ho ld t nlsd o edr bt i e hs bank o a r r pp opriate b a c . rnh 3 Any q a i i do c n i i n ltenderw l be r j c e . . ulfe r o d t o a il eetd 4 I a c r o a i n makes t e t n e , t e form s ould be s . f oprto h edr h h igned by an of c r o t e c r o a i n a th r z d t make the fi e f h o p r t o u o i e o ten r and t e s g i g o t e form by an of c r o t e c r r ti n w l be co s u a a r p e e t t o by him that he de h inn f h fi e f h o po a o i l n tr ed s e r s n a i n has been s a t o i e . I t ten r i made by a pa t o u h r z d f he de s r nership i s o d be sig ed by a member o t e f r , w i0 t h ul n f h im > s o l s g i t e form “__________________ ,a c p r n r h p by_— ____________________ hud in n h oatesi, _ a member o t e f r . f h im” * 5 Tenders from t o o h r than i c r o a e banks and t u t companies o r s o s b e and r c n e d a e s i invest . h se t e noprtd rs r epnil e og iz d e l r n ment s c r t e w l be d s e a d d u l s accompanied by a d p s t o 2 pe c n o t e t t l amount (maturity value1 e u i i s il irgre, nes eoi f r e t f h oa o th Treasury bls a p i d f r o u l s t e te d r a accompanied by an exp es guaranty o f l payment by ai f e il p l e o , r n e s h n e s re r s f ul r i c r o a e bank o t u tcompany. noprtd r rs ' 6 . I t e language o t i form i changed i any r s e t w i h, i t e o i i n o t f h f hs s n e p c , h c n h p n o f he Se cretary o t e Treasury f h m t r a , th tender may be d s e a d d aeil e irgre. * (See reverse for announcement)