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F ederal R eserve Bank


D allas




Circular No. 68-2
January 3, 1968

To All B a n k in g Institutions a n d O th ers C o n c e r n e d
in t h e Eleventh F e d e r a l R e serv e District:
Your a t t e n t i o n is in v ited to th e f o llo w in g s t a t e m e n t giving d e t a il s of tw o iss u e s of T re asu ry bills:
T h e T reasury D epartm ent, b y this public notice, invites tenders for two series of T reasury bills to the aggregate am ount
of $2,500,000,000, or thereabouts, for cash and in exchange for T reasury bills m aturing January 11, 1968, in the am ount of
$2,501,746,000, as follows:
91-DAY B IL L S (to m aturity date) to be issued January 11, 1968, in the am ount of $1,500,000,000, or there­
abouts, representing an additional am ount of bills dated October 13, 1967, and to m ature April 11, 1968,
originally issued in the am ount of $1,000,840,000, the additional and original bills to be freely interchangeable.
182-DAY B IL L S for $1,000,000,000, or thereabouts, to be dated Jan u ary 11, 1968, and to m ature Ju ly 11, 1968.
T he bills of both series will be issued on a discount basis under competitive and noncompetitive 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
denominations of $1,000, $5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000 (m atu rity value).
Tenders will be received a t Federal R eserve B anks and Branches up to the closing hour, one-thirty p.m., E astern
Standard Tim e, Monday, January 8, 1968. T enders will not bs received a t the T reasury D epartm ent, Washington. Each
tender m ust be for an even m ultiple of $1,000, and in th e case of com petitive tenders the price offered m ust be expressed on
th e basis of 100, with not more than three decimals, e.g., 99.925. Fractions m ay not be used. I t is urged th a t tenders be made
on th e printed forms and forwarded in the special envelopes which will be supplied by Federal Reserve Banks or Branches
on application therefor.
Banking institutions generally m ay subm it tenders for account of customers provided the names of th e 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 w ithout deposit from incorporated banks and trust companies and from responsible and recognized
dealers in investm ent securities. Tenders 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 p aym ent by an incorporated bank or
tru st company.
Im m ediately after the closing hour, tenders will be opened a t th e Federal Reserve B anks and Branches, following which
public announcem ent will be m ade by the T reasury D epartm ent of the am ount and price range of accepted bids. Those
subm itting 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. Subject 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 th e average price (in three decimals) of accepted competitive bids for the respective issues. Settlem ent for
accepted tenders in accordance with the bids m ust be made or completed a t the Federal R eserve B ank on January 11, 1968, in
cash or other im m ediately available funds or in a like face am cunt of T reasury bills m aturing January 11, 1968. Cash and
exchange tenders will receive equal treatm ent. Cash adjustm ents will be m ade for differences between the p ar value of m atu r­
ing bills accepted in exchange and the issue price of the new bills.
T h e income derived from T reasury bills, w hether interest or gain from the sale or other disposition of th e bills, does not
have any exemption, as such, and loss from th e sale or other disposition of Treasury bills does not have any special treatm ent,
as such, under th e Internal Revenue Code of 1954. T he bills are subject to estate, inheritance, gift or other excise taxes, whether
F ed eral or State, b u t are exem pt from all taxation now or hereafter imposed on th e principal or interest thereof by any State,
or any of the possessions of the U nited States, or b y any local taxing authority. F o r purposes of taxation the am ount of discount
a t which T reasury bills are originally sold by the U nited States is considered to be interest. U nder Sections 454 (b ) and
1221 (5 ) of the Internal Revenue Code of 1954 the am ount of discount a t which bills issued hereunder are sold is not con­
sidered 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 T reasury bills (other th an life insurance companies) issued hereunder need include
in his income tax return only the difference between th e price paid for such 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 th e taxable year for which the
return is made, as ordinary gain or loss.
T reasury D epartm ent Circular No. 418 (current revision) and this notice, prescribe the term s of th e T reasury bills and
govern the conditions of th eir issue. Copies of th e circular m ay be obtained from any Federal Reserve B ank or Branch.

In a c c o r d a n c e w ith t h e a b o v e a n n o u n c e m e n t , t e n d e r s will b e r e c e iv e d a t this b a n k a n d its b r a n c h e s a t El P a so ,
Houston a n d S a n A n to n io u p to tw e l v e - th ir ty p.m ., C e ntral S t a n d a r d Time, M o n d a y , J a n u a r y 8, 1 9 6 8 . T e n d e rs m a y
not b e e n t e r e d by t e l e p h o n e .
Yours v e r y truly,
W a t r o u s H. Irons
P re sid e n t
Amount, Range and Approxim ate Yield of Accepted Tenders
91-Day Bills
183-Day Bills
D ue April 4, 1968
D ue Ju ly 5, 1968
$2,375,792,000_______________________________T otal A pplied For.______________________________ $2,052,216,000
$ 1,500,2 72,000________________________________ T otal Accepted_________________________________$1,000,084,000
98.722___________ 5.056%...___ ____________________ H igh______________________ 97.168___________ 5.571%
98.700___________ 5.143% ______ __________________ Low______________ _______ 97.146_____ ____ 5.614%
98.710___________ 5.103% (1 ). .....
___________ Average_____________________97.157___ ______ 5.593% (1)
( 1 ) T h e s e r a t e s a r e o n a b a n k d i s c o u n t b a s is . T h e e q u i v a l e n t c o u p o n i s s u e y i e l d s a r e 5 . 2 6 %
t h e 1 8 3 - d a y bills.

f o r t h e 9 1 - d a y b i ll s , a n d 5 . 8 5 %


( S e e r e v e r s e s id e fo r te n d e r fo r m )

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


Maturing April 11, 1968

Dated October 13, 1967
To: Federal Reserve Bank, Station K, Dallas, Texas 75222
or —
El Paso 79999

Houston 77001


San Antonio 78206

P u r s u a n t to th e prov isio ns of T re a s u r y D e p a rtm e n t C irc u la r No. 418 (c u r re n t rev ision) a n d th e p rovisio ns of th e
public ann o u n cem en t issued by th e T re a s u r y D e p a rtm e n t, th e u n d ersig n ed offers to p u rc h a s e T re a s u ry b ills in th e a m o u n t
show n below, an d a g re e s to p a y f o r th e a m o u n t allo tte d , on o r before th e issue d ate, by th e m eth o d an d a t th e r a t e indicated.

_NOT TO EXCEED $200,000


N oncom petitiv e te n d e rs fo r $200,000 o r less from a n y one bid d er, w ith o u t s ta te d price, w ill be accepted in fu ll a t the a v e ra g e
p rice (in th re e decim als) o f accepted com p etitive bids.
/ .





------ -------- ------------------



P ric e s should be e x ­
p re sse d on th e b asis of
100, w ith n o t m o re th a n
t h r e e d e c im a l p l a c e s ,
e. g., 99.925. F ra c tio n s
m u s t n o t b e used.

C LO SIN G H O U R , A R E A C C E P T A B L E .
D en o m in atio n s D esired
Number o f

P a y m e n t f o r th is issu e of bills c a n n o t be m ade
b y c re d it to T re a s u ry T a x an d L oan A ccount.

M aturity V alue


1,000 $5,000 $-


10,000 $50,000 ¥-


(a) ? 100,000 ?© ? 500,000 $-


(® $
(a) ¥
.O $


By maturing bills
held by_____________________________
Payment to be made by_____________
Charge our reserve account on payment
Draft enclosed ( E f f e c t u a l d e liv e r y o f enclosed
draft shall be on latest day which will permit present­
ment in order to obtain irrevocably collected funds on
payment date)

$1.,000,000 ?Delivery Instructions:

Pledge to secure Treasury Tax and
Loan Account

(Subscriber's full name or corporate title)

Hold in Custody Account— Member
banks for own account only


Ship to________________________ __

B y
(Authorized official signature and title)
(For the account of, if tender is for another subscriber)


1. N o te n d e r f o r less th a n $1,000 w ill be considered an d each te n d e r m u s t be f o r a n a m o u n t in m u ltip les o f $1,000 ( m a tu r it y
v a lu e ).
2 . T enders should be fo rw a rd e d in a n envelope cle a rly ad d re sse d to th is b an k o r a p p ro p r ia te b ra n c h a s F is c a l A g e n t of t h e
U n ite d S ta te s, w ith n o ta tio n on th e envelope re a d in g “T E N D E R F O R T R E A S U R Y B IL L S ”. Since envelopes re c e iv e ^
w ith th is legend w ill n o t be opened u n til a f t e r th e closin g tim e specified in th e public an nou ncem ent, co m m u n ic atio n s
re la tin g to o th e r m a tte rs should n o t be enclosed. E n v elo p es fo r s u b m ittin g te n d e rs m a y be o b ta in ed fro m th is b a n k
or a p p ro p r ia te b ran ch .
A n y qualified o r conditional te n d e r w ill be rejected .
I f a co rp o ratio n m a k es th e te n d e r, th e fo rm should be sig n ed by a n officer of th e c o rp o ra tio n a u th o riz e d to m a k e t h e
te n d e r a n d th e sig n in g of th e fo r m by a n officer o f th e co rp o ratio n w ill be co n stru ed as a re p re s e n ta tio n b y him t h a t h e
h a s been so a u th o rized . If th e te n d e r is m ad e b y a p a rtn e rs h ip i t should be sig n ed by a m e m b e r o f th e firm , w h o
should sig n in th e fo rm “ ........................................................... , a c o p a rtn e rsh ip , b y ....................................................................................... f
a m e m b er o f th e firm ”.
5. T en d ers fro m th o se o th e r th a n in c o rp o rated b an k s an d tr u s t com panies o r resp o n sib le an d recognized d ealers in in v e s t­
m e n t secu rities w ill b e d isreg ard ed , u nless accom panied b y a d ep o sit of 2 p e rc e n t o f th e to ta l a m o u n t (m a tu r ity v a lu e )
of th e T re a s u r y bills ap p lied fo r, o r u n le ss th e te n d e rs a re accom panied b y a n ex p re ss g u a r a n ty o f fu ll p a y m e n t b y a n
in c o rp o rated b a n k o r t r u s t com pany.
6. If the language of this form is changed in any respect, which, in th e opinion of the S ecretary of the T reasu ry j s

m aterial, the tend er m ay be disregarded.
(See reverse fo r announcem ent)

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