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R eserve federal bank of Dallas F IS 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. 71-112 M ay 11, 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 follow in g statem ent giving details of tw o issues of Treasury bills: T h e Treasury Departm ent, by this public notice, invites tenders for two series of Treasury bills to the aggregate am ount o f $3,400,000,000, or thereabouts, for cash and in exchange for Treasury bills m aturing M ay 20, 1971, in the am ount of $3,407,010,000, as follows: 91-D A Y B IL L S (to m aturity date) to be issued M ay 20, 1971, in the amount of $2,000,000,000, or thereabouts, representing an additional amount of bills dated February 18, 1971, and to mature August 19, 1971 (C U S IP No. 912793 L E 4 ), originally issued in the amount of $1,402,285,000 (an additional $200,520,000 was issued April 6, 1 9 7 1 ), the additional and original bills to be freely interchangeable. 182-D A Y B IL L S for $1,400,000,000, or thereabouts to be dated M ay 20, 1971, and to mature Novem ber 18, 1971 (C U S IP No. 912793 L S 3 ). 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 at m aturity their face amount will be payable without interest. T h ey 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 aturity v a lu e). Tenders will be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern D a ylig h t Savings T im e, M onday, M ay 17, 1971. Tenders w ill not be received at the Treasury Departm ent, W ashington. Each tender m ust be for a m inim um of $10,000. Tenders over $10,000 must 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 that tenders be made on the printed forms and forwarded in the special envelopes which will be supplied by Federal R eserve 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. Others than banking institutions will not be perm itted to subm it tenders except for their own account. T enders will be received without deposit from incorporated banks and trust com panies and from responsible and recognized dealers in investm ent securities. Tenders from others must be accom panied by paym ent of 2 percent of the face am ount of Treasury bills applied for, unless the tenders are accom panied by an express guaranty of paym ent by an incorporated bank or trust company. Im m ediately after the closing hour, tenders will be opened at the Federal Reserve Banks and Branches, follow ing which public announcem ent will be made by the Treasury Departm ent of the amount and price range of accepted bids. Only those subm itting com petitive tenders w ill 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 without stated price from any one bidder will be accepted in full at the average price (in three decim als) of accepted com petitive bids for the respective issues. Settlem ent for accepted tenders in accordance with the bids m ust be made or com pleted at the Federal Reserve Bank on M ay 20, 1971, in cash or other im m ediately available funds or in a like face amount of Treasury bills maturing M ay 20, 1971. Cash and exchange tenders w ill receive equal treatment. Cash adjustm ents will be made for differences betw een 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 R evenue Code of 1954 the amount of discount at 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 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 am ount actually received either upon sale or redem ption at m aturity during the taxable year for which the return is made. Treasury Departm ent 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 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 be received at this bank an d its branches at El Paso, Houston a n d San Antonio up to twelve-thirty p.m., Central Daylight Savings Time, M on d a y, M a y 17, 1971. Tenders may not b e entered by t ele p h o n e . Yours very truly, P. E. Coldwell President LAST PREVIOUS OFFERING OF TREASURY BILLS Amount, Range and Approxim ate Y ield of A ccepted Tenders 91-D ay B ills 182-D ay B ills D u e August 12, 1971 D u e N ovem ber 11, 1971 $3,075,160,000 T otal Applied For--------------------------------------------------- $2,653,855,000 $2,000,175,000___________________________________T otal A ccepted___________________________________ $1,400,180,000 Price Y ield Price Y ield 99.047------------------ 3 .770% ------------------------------------------ H igh ,.---------------------------------- 9 7.911____________ 4.132% 99.015------------------ 3.897 % ------------------------------------------- Low ------------------------------------97.883____________ 4.187% 99.024------------------ 3.861% ( 1 ) --------------------------------- Average----T___ _T ____________97.888____________ 4 . 178% ( 1 ) . _ (1 ) These rates are on a bank discount basis. The equivalent coupon issue yields are 3.96% for the 91-day bills and 4 34% for the 182-day bills. ' (S e e 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 May 20,1971 Maturing November 18,1971 To: Federal Reserve Bank, Station K, Dallas, Texas 75222 or — The-------------------------------------Branch El Paso 79999 Houston 77001 San Antonio 78206 (D a te ) Pursuant t the provisions o Treasury Department Circular No. 418 (current r v s o ) and the provisions of the o f eiin p b i announcement iss e by the Treasury Department, the undersigned o f r t purchase Treasury b l s i the amount ulc ud fes o il n shown below, and agrees t pay for the amount a l t e , on or before the i s e d t , by the method and a the rate i d c t d o lotd su ae t niae. NONCOMPETITIVE TENDER $________________________________ JNOT TO EXCEED $200,000 Noncompetitive tenders f r $200,000 or l s from any one b d e , without stated p i e w l be accepted i f l a the average o es idr rc, il n ul t p i e ( n three decimals) o accepted competitive b d . rc i f is Prices should be ex pressed on the basis of 1 0 with not more than 0, COMPETITIVE TENDERS $ @ ..“$ ■T “ three decimal places, e g, 9 . 2 . Fractions . . 995 $ @ $ must not be us d e. TENDERS M A Y NOT BE ACCEPTED BY TELEPHONE. TENDERS BY WIRE, IF RECEIVED BEFORE THE CLOSING HOUR, ARE ACCEPTABLE. ' Denominations Desired Payment for t i i s e o b l s cannot be made by h s s u f il N u m b e r of c e i t Treasury Tax and Loan Account. rdt o M a tu rity V alue pieces METHOD OF PAYMENT l @ $ 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 | | D r a f t e n c l o s e d (E ffectu al delivery of enclosed d r a f t shall be on la te st day which will p e rm it p re s e n tm e n t in o rd er to o btain 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 n am e o r c o rp o ra te title) (A dd ress) By(A u tho rized official s ig n a tu re an d title) (F o r the acco un t of, if te n d e r is fo r a n o th e r sub scrib er) (A d dress) IMPORTANT 1 No tender for l s than $10,000 w l be considered and each tender over $10,000 must be for an amount i multiples of . es il n $ , 0 (maturity v l e . 500 au) 2 Tenders should be forwarded i an envelope c e r y addressed t t i bank or appropriate branch as F s a Agent of the . n lal o hs icl United S a e , with notation on the envelope reading “TENDER FOR TREASURY OFFERING”. Since envelopes tts received with t i legend w l not be opened u t l af e the c o i g time s e i i d i the p b i announcement, communi hs il ni t r lsn pcfe n ulc cat o s r l t n t other matters should not be e c o e . Envelopes fo submitting tenders may be obtained from t i in eaig o nlsd r hs bank or appropriate branch. 3 Any q a i i d or c n i i n l tender w l be r j c e . . ulfe odtoa il eetd 4 I a corporation makes the t n e , the form should be signed by an o f c r of the corporation authorized t make the . f edr fie o tender and the signing o the form by an o f c r o the corporation w l be construed as a representation by him that he f fie f il has been s autho i e . I the tender i made by a partnership i should be signed by a member o the f r , who o rzd f s t f im should sign i the form “___________________ ,a copartnership, by___________________________ — n , a member o the f r . f im” 5 Tenders from those other than incorporated banks and t u t companies or responsible and recognized d a . rs e lers i invest n ment s c r t e w l be disregarded, unless accompanied by a deposit o 2 percent o the t t l amount (maturity value) euiis il f f oa of the Treasury b l s applied f r or unless the tenders are accompanied by an express guaranty o f l payment by an il o, f ul incorporated bank or t u t company. rs 6 I the language o t i form i changed i any r s e t which, i the opinion o the Secretary of the Treasury i . f f hs s n epc, n f s material, the tender may be disregarded. (See reverse for announcement)