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FEDERAL RESERVE BANK OF DALLAS F IS C A L A G E N T O F T H E UNITED S T A T E S DALLAS, TEXAS 75222 Circular No. 71-80 April 6, 1971 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 fo llo w in g statem ent giving details of tw o 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 $3,600,000,000, or thereabouts, for cash and in exchange for T reasury bills m aturing April 15, 1971, in the am ount of $3,407,690,000, as follows: 91-DAY B IL L S (to m aturity d ate) to be issued April 15, 1971, in the am ount of $2,000,000,000, or thereabouts, representing an additional am ount of bills dated Jan uary 14, 1971, and to m ature July 15, 1971 (C U S IP No. 912793 K Y I), originally issued in the am ount of $1,407,895,000 (an additional am ount of $200,520,000 was issued tod a y), the additional and original bills to be freely interchangeable. 182-DAY B IL L S for $1,600,000,000, or thereabouts, to be dated April 15, 1971, and to m ature October 14, 1971 (C U S IP No. 912793 L M 6). T h e 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, $15,000, $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 Standard Tim e, Monday, April 12, 1971. T enders will not be received a t the Treasury D epartm ent, W ashington. Each tender m ust be for a m inim um of $10,000. Tenders over $10,000 m ust be in m ultiples of $5,000. In the case of com petitive tenders the price offered m ust be expressed on the 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 made on the printed forms and forwarded in the special envelopes which will be supplied by F ederal Reserve Banks or Branches on application therefor. Banking institutions generally m ay subm it tenders for account of customers provided the nam es 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 their 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. T enders from others m ust be accompanied 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 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. 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 decim als) of accepted com petitive bids for the respective issues. S ettlem ent for accepted tenders in accordance with the bids m ust be m ade or completed a t the Federal Reserve B ank on A pril 15, 1971, in cash or other im m ediately available funds or in a like face am ount of T reasury bills m aturing April 15, 1971. Cash and exchange tenders will receive equal treatm ent. Cash adjustm ents will be made for differences between the p ar value of m atur ing bills accepted in exchange and the issue price of the new bills. U nder Sections 454 (b ) and 1221 (5 ) of th e Internal R evenue Code of 1954 the am ount of discount a t which bills issued hereunder are sold is considered to accrue when the bills are sold, redeem ed or otherwise disposed of, and the bills are excluded from consideration as capital assets. Accordingly, the owner of Treasury bills (other than life insurance com panies) issued here under m ust include in his income tax return, as ordinary gain or loss, the difference between the price paid for the 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. T reasury D epartm ent Circular No. 418 (current revision) and this notice, prescribe the term s of the T reasury bills and govern the conditions of their issue. Copies of the circular m ay be obtained from any Federal Reserve B ank or Branch. In accord ance with the a b o v e a n n o u n c em en t, tenders will b e received at this bank a n d its branches at El Paso, Houston a n d San Antonio up to twelve-thirty p.m., Central Standard Time, M on d ay, April 12, 1971. Tenders m a y not be entered by tele p h o n e . Yours very truly, P. E. Cold well President LAST PREVIOUS OFFERING OF TREASURY BILLS Amount, R ange and A pproxim ate Y ield of Accepted Tenders 91-Day Bills 182-Day Bills D ue July 8, 1971 D ue October 7, 1971 $2,794,745,000 -Total Applied F o r_______________________________ $2,599,475,000 $2,000,005,000________________________________ T otal A ccepted_________________________________$1,600,175,000 Price Yield Price Yield 99.078___________ 3.647% __________________________.H igh______________________98.120___________ 3.719% 99.055___________ 3.738% __________________________ Low______________________ 98.087___________ 3.784% 99.064___________ 3.703% ( 1 ) ___________________ .Average____________________ 98.102____________3.754% (1) (1 ) These rates are on a bank discount basis. The equivalent coupon issue yields are 3.80% for the 91-day bills and 3.89% for 182-day bills. the (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 April 15,1971 Maturing October 14,1971 To: Federal Reserve Bank, Station K, Dallas, Texas 75222 or — The-------------------------------------- Branch El Paso 79999 Houston 77001 San Antonio 78206 (D ate) P u rsu a n t to the provisions of T reasu ry D epartm ent Circular No. 418 (current revision) and th e provisions of th e public announcement issued by the T reasury D epartm ent, the undersigned offers to purchase T reasu ry bills in the am ou nt shown below, and agrees to pay for the am ount allotted, on or before the issue date, by the method and a t the ra te indicated. NONCOMPETITIVE TENDER $_________________________________ JNOT TO EXCEED $200,000 Noncompetitive tenders for $200,000 or less from any one bidder, without stated price, will be accepted in full at the average price (in three decimals) of accepted com petitive bids. Prices should be ex pressed on the basis of 100, with not more th a n th r e e decim al p la c e s , e. g., 99.925. F ra ctio n s --------------------------------m ust_n ot be used. -@ - COMPETITIVE TENDERS >$. (&ST TEN D ERS MAY NOT BE ACCEPTED BY TE L EPH O N E . TEND ERS BY W IRE, IF RECEIV ED BEFO RE T H E CLOSING HOUR, ARE ACCEPTABLE. Denominations D esired N um b er of pieces Paym ent for this issue of bills cannot be m ade by credit to T reasu ry Tax and Loan Account. METHOD O F PAYM ENT M a tu rity V alue @ $ 10,000 ?. @ $ 15,000 ?@ $ 50,000 $. @ $ 100,000 * @ $ 500,000 * @ $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------------------------------------- □ By maturing bills held by____________________________ Payment to be made by--------------------- □ □ Charge our reserve account on payment date Draft enclosed (E ffectual delivery of enclosed d r a f t □ shall be on latest day w hich will p e rm it p re s e n tm e n t in ord er to o b ta in irrevocably collected fu n d s on p a y m e n t d a te ) (S u b sc rib e r’s full n am e o r c o rp o ra te title ) (A dd ress) By(A u th orized official s ig n a tu re a n d title ) (F o r th e a cc o u n t of, if te n d e r is fo r a n o th e r sub scriber) (A dd ress) IM PORTANT 1. No tender fo r less th a n $10,000 will be considered and each tender over $10,000 m ust be fo r an am ount in m ultiples of $5,000 (m atu rity value). 2. Tenders should be forw arded in an envelope clearly addressed to this bank or ap propriate branch as Fiscal A gent of th e United States, w ith notation on th e envelope reading “TEN D ER FOR TREASURY O FF E R IN G ”. Since envelopes received w ith this legend will not be opened until a fte r th e closing time specified in the public announcement, com m uni cations relating to other m a tte rs should not be enclosed. Envelopes for subm itting tenders m ay be obtained fro m th is bank or appropriate branch. 3. A ny qualified or conditional tender will be rejected. 4. If a corporation m akes the tender, th e form should be signed by an officer of the corporation authorized to m ak e th e tender and the signing of the form by an officer of the corporation will be construed as a representation by him th a t he has been so authorized. If the tender is m ade by a p artn e rsh ip it should be signed by a member of the firm, who f should sign in the form “___________________________ , a copartnership, by----------------a m em ber of the firm.” 5. Tenders from those other th a n incorporated banks and tr u s t companies or responsible and recognized dealers in in v e st m ent securities will be disregarded, unless accompanied by a deposit of 2 percent of the total am ount (m atu rity v alu e) of the T reasury bills applied for, or unless the tenders are accompanied by an express g u ara n ty of full paym ent by an incorporated bank or tru s t company. 6. If th e language of this form is changed in any respect, which, in the opinion of the Secretary of th e T re asu ry is m aterial, th e tender m ay be disregarded. (See reverse for announcement)