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federal Reserve b a n k of Dallas F IS C A L A G E N T O F T H E U N ITED S T A T E S DALLAS, TEXAS 75222 Circular No. 67-186 Septem ber 20, 1967 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 sta te m e n t giving d etails of tw o is sues of Treasury bills: T he Treasury D epartm ent, by this public notice, invites tenders for two series of Treasury bills to the aggregate am ount of $1,500,000,000, or thereabouts, for cash and in exchange for Treasury bills m aturing Septem ber 30, 1967, in the am ount of $1,400,163,000, as follow s: 272-D A Y B IL L S (to m aturity d ate) to be issued October 2, 1967, in the am ount o f $500,000,000, or there abouts, representing an additional am ount of bills dated June 30, 1967, and to m ature June 30, 1968, originally issued in the am ount of $1,000,547,000, th e additional and original bills to be freely interchangeable. 366-D A Y B IL L S for $1,000,000,000, or thereabouts, to be dated Septem ber 30, 1967, and to m ature Septem ber 30, 1968. T h e bills of both series w ill be issued on a discount basis under com petitive and noncom petitive bidding as hereinafter provided, and at m aturity their face am ount w ill be payable without interest. T h ey w ill be issued in bearer form only, and in denom inations of $1,000, $5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000 (m aturity v a lu e ). Tenders w ill be received at Federal R eserve B anks and Branches up to the closing hour, one-thirty p.m., Eastern D ayligh t Saving T im e, Tuesday, Septem ber 26, 1967. T enders w ill not be received at the Treasury D epartm ent, W ashington. Each tender m ust be for an even m ultiple of $1,000, and in the case of com petitive tenders th e price offered m ust be expressed on the basis of 100, w ith not m ore than three decim als, e.g., 99.925. Fractions m ay not be used. (N otw ithstanding the fact that th e one-year bills w ill run for 366-days, the discount rate w ill be com puted on a bank discount basis of 360-days, as is currently the practice on all issues of Treasury b ills.) It is urged that tenders be m ade on the printed form s and forwarded in th e special envelop es which w ill be supplied by Federal R eserve Banks or Branches on application therefor. B anking institutions generally m ay subm it tenders for account of custom ers provided the nam es of th e custom ers are set forth in such tenders. Others than banking institutions w ill not be perm itted to subm it tenders except for their own account. Tenders w ill be received w ithout deposit from incorporated banks and trust com panies 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 Treasury b ills applied for, unless the tenders are accom panied by an express guaranty of paym ent by an incorporated bank or trust com pany. Im m ediately after th e closing hour, tenders w ill be opened at the Federal R eserve Banks and Branches, follow ing which public announcem ent w ill be m ade by the Treasury D epartm ent of the am ount and price range of accepted bids. T hose subm itting 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 w hole or in part, and his action in any such respect shall be final. Subject to these reservations, noncom petitive tenders for each issue for $200,000 or less w ithout stated price from any one bidder w ill 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 w ith the bids m ust be m ade or com pleted at the Federal R eserve B ank on O ctober 2, 1967, in cash or other im m ediately available funds or in a like face am ount of Treasury bills m aturing Septem ber 30, 1967. Cash and exchange tenders w ill receive equal treatm ent. Cash adjustm ents w ill be m ade for differences betw een the par value of m aturing b ills accepted in exchange and the issue price of the new bills. T h e incom e derived from Treasury bills, whether interest or gain from the sale or other disposition of the bills, does not have any exem ption, as such, and loss from the sale or other disposition of Treasury bills does not have any special treatm ent, as such, under the Internal R evenue Code of 1954. T he b ills are subject to estate, inheritance, gift or other excise taxes, whether Federal or State, but are exem pt from all taxation now or hereafter im posed on the principal or interest thereof by any State, or any of the possessions of the U nited States, or by any local taxing authority. For purposes of taxation th e am ount of discount at which Treasury bills are originally sold by the U n ited States is considered to be interest. Under Sections 454 ( b ) and 1221 ( 5 ) of the Internal R evenue Code of 1954 the am ount of discount at which bills issued hereunder are sold is not considered to accrue until such bills are sold, redeem ed or otherwise disposed of, and such bills are excluded from consideration as capital assets. Accordingly, the owner of Treasury bills (other than life insurance com panies) issued hereunder need include in his incom e tax return only the difference betw een the price paid for such 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 m ade, as ordinary gain or loss. Treasury D epartm ent Circular N o. 418 (current revision ) and this notice, prescribe th e term s of th e Treasury govern th e conditions of their issue. Copies of the circular m ay be obtained from any Federal R eserve Bank or Branch. bills and In accord ance with the a b o v e a n n o u n c em en t, fenders will b e received at this b a n k a n d its branches a t El Paso, Houston a n d San Antonio, up to twelve-thirty p.m., Central Daylight Saving Time, Tuesday, Septem b er 2 6 , 1967. Tenders m a y not b e entered by tele p h o n e . Yours very truly, Watrous H. Irons President (S e e reverse side 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 366 DAYS TO MATURITY Dated September 30,1967 Maturing September 30, 1968 T o : Federal Reserve Bank, Station K, Dallas, Texas 75222 or — The___________________________________Branch El P aso 79999 Houston 77001 (D ate) San Antonio 78206 P u rsu a n t to th e provisions of T reasu ry D epartm ent Circular No. 418 (curren t revision) and the provisions of the public announcem ent issued by the T reasury D epartm ent, th e undersigned offers to purchase T reasu ry bills in the am ount shown below, and agrees to p ay fo r th e am ount allotted, on or before th e issue date, by the m ethod and a t th e ra te indicated. NONCOMPETITIVE TENDER $_ NOT TO EXCEED $200,000 N oncom petitive tenders for $200,000 or less from any one bidder, without stated price, w ill be accepted in full at the average price (in three decimals) of accepted com petitive bids. I^ „ Prices should be ex pressed on the basis of 100, w ith not more than () a COMPETITIVE TENDERS $ $ th r e e d e c im a l p la c e s , e. g., 99.925. Fractions $...... ___$ .... @ m ust not be used. \ T E N D E R S M AY NOT BE E N T E R E D BY TEL E PH O NE . T E N D E R S B Y W IRE, IF RECEIVED BEFO RE THE CLOSING HOUR, ARE ACCEPTABLE. Denom inations Desired Number of Pieces Paym ent fo r this issue of bills cannot be made by credit to T reasury T ax and Loan Account. M aturity Value (5) $ (5) $ 5,000 $ (5) $ 10,000 $ (5) $ METHOD OF PA Y M E N T 1,000 $ 50,000 $ □ By maturing bills held by______________________________ □ Payment to be made by____________ - □ Charge our reserve account on payment date (5) $ 100,000 $ (5) $ 500,000 $ ] <> $1 ,000,000 $ 5 D r a f t e n c l o s e d ( E f f e c t u a l d e liv e r y o f e n c lo se d draft shall be on latest day which will permit present m ent in order to obtain irrevocably collected funds on paym ent date) Delivery Instructions: (Subscriber’s full name or corporate title) □ Hold in Custody Account— Member banks fo r own account only □ Pledge to secure Treasury Tax and Loan Account (Address) By_ ( Authorized official signature and title) □ Ship to____________________________ ( For the account of, if tender is fo r another subscriber) (Address) IM PORTANT 1. No tender fo r less th a n $1,000 will be considered and each tender m ust be fo r an am ount in m ultiples of $1,000 (m atu rity value). 2. Tenders should be forw arded in an envelope clearly addressed to this bank or appropriate branch as Fiscal A gent of the U nited S tates, w ith notation on the envelope reading “TE N D E R FOR TREA SU RY BILLS”. Since envelopes received w ith this legend will no t be opened until a fte r the closing tim e specified in the public announcem ent, communications relatin g to other m a tte rs should not be enclosed. Envelopes fo r subm itting tenders m ay be obtained from this bank or ap propriate 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 ake the tender and th e 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 partn ersh ip it should be signed by a m em ber of the firm, who should sign in the form “ ................................. ta copartnership, by....................................................... , a mem ber of the firm ”. 5. Tenders from those other th a n incorporated banks and tru s t companies or responsible and recognized dealers in invest m ent securities will be disregarded, unless accompanied by a deposit of 2 percent of the to tal am ount (m atu rity value) of th e T reasu ry bills applied for, or unless the tenders are accompanied by an express g u a ra n ty of fu ll paym ent by an incorporated bank or tru s t company. 6. If the language of this form is changed in any respect, which, in the opinion of the S ecretary o f the Treasury is m aterial, the tender m ay be disregarded. (S ee reverse for announcement)