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F ederal R eserve Bank





C ircular No. 71-206
A ugust 27, 1971

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:
T h e T reasury D epartm ent, b y this public notice, invites tenders for two series of T reasury bills to th e aggregate am ount
of $3,900,000,000, or thereabouts, for cash and in exchange for T reasury bills m aturing Septem ber 9, 1971, in th e am ount of
$3,702,250,000, as follows:
91-DAY B IL L S (to m a turity d ate) to be issued Septem ber 9, 1971, in th e am ount of $2,300,000,000, or there­
abouts, representing an additional am ount of bills dated Ju n e 10, 1971, and to m ature D ecem ber 9, 1971
(C U S IP No. 912793 L V 6), originally issued in the am ount of $1,400,480,000, 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 Septem ber 9, 1971, and to m ature M arch 9, 1972
(C U S IP No. 912793 M R 4 ).
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 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 value).
T enders will be received a t F ederal R eserve B anks and Branches up to th e closing hour, one-thirty p.m., E astern
D aylight Saving Tim e, Friday, Septem ber 3, 1971. T enders will not be received a t th e T reasury D epartm ent, Washington. Each
ten d er m ust be for a m inim um of $10,000. T enders 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 th e basis of 100, w ith 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 an d forwarded in th e special envelopes which will be
supplied by F ederal R eserve B anks or B ranches on application therefor.
B anking institutions generally may subm it tenders for account of customers provided the names of th e customers are
set forth in such tenders. O thers th a n banking institutions will not be perm itted to subm it tenders except for th e ir own account.
T enders will be received without 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 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 a fte r th e closing hour, tenders will be opened a t th e Federal R eserve Banks and Branches, following which
public announcem ent will be m ade by th e T reasury D epartm en t of the am ount and price range of accepted bids. Only those
subm itting com petitive tenders will be advised of th e acceptance or rejection thereof. T h e 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 th e respective issues. S ettlem ent for
accepted tenders in accordance with the bids m ust be made or com pleted a t the F ederal R eserve B ank on Septem ber 9, 1971,
in cash or other im m ediately available funds or in a like face am ount of T reasury bills m aturing Septem ber 9, 1971; provided,
however, th a t settlem ent for tenders subm itted to th e Federal R eserve B ank of San Francisco or its Los Angeles B ranch m ust be
com pleted a t the bank or branch on Septem ber 10, 1971, and m ust include one day’s accrued interest if settlem ent is m ade with
other th an T reasury bills m aturing Septem ber 9. Cash and exchange tenders will receive equal treatm ent. Cash adjustm ents will
be made for differences between th e p ar value of m aturing 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 th e am ount of discount a t which bills issued
hereunder are sold is considered to accrue when th e bills are sold, redeem ed or otherwise disposed of, and the bills are excluded
from consideration as capital assets. Accordingly, the owner of T reasury bills (other th an life insurance com panies) issued here­
u nder 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, an d th e am ount actually received either upon sale or redem ption a t m aturity during the
taxable year for which th e return is made.
T reasury D ep artm en t C ircular No. 418 (curren t revision) and this notice, prescribe th e term s of th e T reasury bills and
govern th e conditions of their issue. Copies of th e circular m ay be obtained from any F ederal R eserve B ank 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 Daylight Saving Time, Friday, September 3, 1971. Tenders
may not be entered by telephone.
Yours very truly,
P. E. Coldwell


Figures c o n c e rn in g offering o f 9 1 -D ay T reasury Bills maturing D e c e m b e r 2, 1 9 7 1 , a n d 1 8 2 -D a y Treasury Bills maturing
M arch 2, 1 9 7 1 , no t a v a i la b l e w h e n this circular w a s printe d.

(S e e reverse for tender form )

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (


Dated September 9,1971

Maturing March 9, 1972

To: Federal Reserve Bank, Station K, Dallas, Texas 75222
or —
The________________________ Branch
El Paso 79999

Houston 77001

San Antonio 78295-------------------------- --------------------------------(Date)

Pursuant to the provisions of Treasury Department Circular No. 418 (current revision) and the provisions of the
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 b.ds.
$ ----------------------------- @ ________ $ ------------------------------


Prices should be ex ­
pressed on the basis of

@_____ $_______________________Sre^ ecT m aT pla^ ,

----------------------@ ----------- $ --------------------------------------

e g . , 99.925. Fractions
must not be used.

Number of

Denominations Desired
. . . . . .
Maturity Value

M % 10,000 %
(5) $ 15,000 %
© ? 50,000 ?-

Payment for this issue of bills cannot be made by
credit to Treasury Tax and Loan Account.



-© $ 100,000 ?-© ? 500,000 $-< > $1,000,000 ?S
Delivery Instructions:
□ Hold in Custody Account—Member
banks for own account only

By maturing bills
held-by--------------------------------------- -Payment to be made by_


Charge our reserve account on payment
| | Draft e n c l o s e d (Effectual delivery of enclosed d ra ft
shall be on latest day which will p e rm it p re s e n tm e n t in


obtain irrevocahly c lle !te 1 lund"on paym

(S u b ^ r ita e r '. full nam e o r c orpo ra te title)

Pledge to secure Treasury Tax and--------------Loan Account
ByShip to------------------------

ddress)--------------(A uthorized official eigrnatnre a nd title)
( F o r th e account of, if te nder is fo r an o th e r subscriber)




No tender for less than $10,000 will be considered and each tender over $10,000 must be for an amount in multiples of
$5,000 (maturity value).
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 this
bank or appropriate branch.
Any qualified or conditional tender will be rejected.
If a corporation makes the tender, the form should be signed by an officer of the corporation authorized to make the
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.”
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 value)
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.
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)

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