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Reserve Bank









Circular No. 68-23
January 24, 1968

To All B a n k in g In stitutions a n d O th e r s 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 ite d to th e f o llo w in g s t a t e m e n t giv ing d e t a il s of tw o is s u e s of T re as u ry 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 $2,500,000,000, or thereabouts, for cash and in exchange for T reasury bills m aturing February 1, 1968, in th e am ount of
$2,501,430,000, as follows:
91-DAY B IL L S (to m aturity date) to be issued February 1, 1968, in the am ount of $1,500,000,000, or there­
abouts, representing an additional am ount of bills dated November 2, 1967, and to m ature M ay 2, 1968,
originally issued in the am ount of $999,896,000, 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 F ebruary 1, 1968, and to m ature August 1, 1968.
T he bills of both series will be issued on a discount basis under competitive 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
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 Reserve B anks and B ranches up to th e closing hour, one-thirty p.m., Eastern
Standard Tim e, M onday, January 29, 1968. Tenders will not be 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 the case of com petitive tenders th e price offered m ust be expressed on
the basis of 100, with not more th a n three decimals, e.g., 99.925. Fractions m ay not be used. I t is urged th a t tenders be m ade
on the printed forms an d forwarded in the special envelopes which will be supplied by Federal Reserve B anks or Branches
on application therefor.
B anking institutions generally may subm it tenders for account of customers provided th e 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 w ithout deposit from incorporated banks and trust companies and from responsible an d 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 accompanied b y an express guaranty of paym ent by a n 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 m ade by the T reasury D epartm ent of th e 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 th e 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 the average price (in three decimals) of accepted com petitive bids for th e respective issues. S ettlem ent for
accepted tenders in accordance with the bids m ust be m ade or com pleted a t the Federal Reserve B ank on February 1, 1968, in
cash or other im m ediately available funds or in a like face am ount of T reasury bills m aturing February 1, 1968. Cash and
exchange tenders will receive equal treatm ent. Cash adjustm ents will be m ade for differences between th e p a r value of m atur­
ing bills accepted in exchange and the issue price of the new bills.
T h e income derived from Treasury bills, w hether interest or gain from the sale or other disposition of the bills, does not
have any exemption, 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 Revenue Code of 1954. T h e bills are subject to estate, inheritance, gift or other excise taxes, whether
Federal or State, b u t are exem pt from all taxation now or hereafter imposed 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 the am ount of discount
a t which T reasury bills are originally sold by th e U nited States is considered to be in te re s t 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, th e owner of Treasury bills (other th a n life insurance com panies) issued hereunder need include
in his income tax retu rn only the difference between the 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 the taxable year for which the
return is made, as ordinary gain or loss.
T reasury D epartm en t Circular No. 418 (current revision) and this notice, prescribe th e 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 a c c o r d a n c e w ith th 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 re 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 aso,
Houston a n d San A n to n io u p to t w e l v e - th ir ty p .m ., Central S t a n d a r d Time, M o n d a y , J a n u a r y 2 9 , 1968. T e n d e rs m a y
not b e e n t e r e d b y t e l e p h o n e .
Y ours v e r y truly,
W a t r o u s H. Irons
P re sid en t
Amount, R ange and Approximate Yield of A ccepted Tenders
91-Day Bills
182-Day Bills
D ue April 25, 1968
D ue Ju ly 25, 1968
$3,217,269,000------------------------------------- ---------T otal Applied For.______________________________ $2,678,810,000
$1,503,317,000____ _ ________________________ T otal Accepted_______________________________ $1,001,026,000
98.728------------------ 5.032% _________________________ H igh______________________97.318___________ 5.305%
5.076% __________________________ Low______________________ 97.300___________ 5.341%
5.068% ( 1 ) ______ ______________ Average__________ __________ 97.303__ __ ______ 5.335% (1)
( 1 ) T h e s e rates are on a bank discount basis. T h e eq u iv a le n t coupon issue y ie ld s are 5 .2 2 % for t h e 9 1 -d a y b ills, an d 5 .5 7 % f ° r
t h e 1 82-d a y bills.

(See reverse side for tender form)

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


Dated February 1, 1968

Maturing August 1, 1968

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

Houston 77001


San Antonio 78206

P u rs u a n t to th e provisions 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 revisio n) an d th e pro v isio n s o f t h e
public an noun cem ent issued b y 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 rch ase T re a s u r y bills 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 am o u n t allo tted , o n o r b efo re the issue d ate, b y th e m e th o d a n d a t th e r a te in d ic a te d .



N oncom petitive te n d e rs fo r $200,000 o r less from any one b id d er, w ith o u t s ta te d price, w ill be accepted in fu ll a t th e a v e r a g e
price (in th re e d ecim als) of accep ted com petitive bids.

Prices should be ex ­



p re sse d on th e b a sis o f


t h r e e d e c im a l p l a c e s ,


e. g., 99.925. Fractions

100, with not more th a n

-@ .


m u s t n o t be used.

D eno m inatio ns D esired
Number of

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

Maturity Value

© $
© $
© ?
© $


1,000 *.
5,000 ?-


10,000 $50,000 $.


By maturing bills
held by_________________________
Payment to be made by____________ _

.© $ 100,000 $.
$ 500,000 $-

□ Charge our reserve account on payment
I ] Draft enclosed ( E f f e c t u a l d e liv e r y o f enclosed

© $1 ,000,000 $-

d r a f t shall be on la te st day which will p e rm it p r e s e n t ­
m e n t in order to o btain irrevocably collected f u n d s o n
p a y m e n t date)

Delivery Instructions:

Pledge to secure Treasury Tax and
Loan Account

(S ubscriber’s fu ll n a m e or c o rp o ra te title)

Hold in Custody Account—Member
banks for own account only



(A uthorized official s ig n a tu re an d title )

Ship to___________________________
(F o r the account of, if te n d e r is fo r a n o th e r 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 t u r i t y
v alu e).
2. T end ers should be fo rw a rd e d in a n envelope cle a rly ad d re s se d to th is b an k o r a p p ro p r ia te b ran ch as F is c a l A g e n t o f t h e
U nited 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 received
w ith th is legend w ill n o t be opened u n til a f t e r th e closing tim e specified in th e public anno uncem 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 b e enclosed. E nv elo p es f o r s u b m ittin g te n d e rs m a y b e o b ta in ed fro m th is b a n k
o r a p p ro p ria te b ranch.
A ny 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 an d th e sig n in g of th e fo rm 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 by him t h a t h e
h as been so au th o rized . If th e te n d e r is m ade b y a p a rtn e rs h ip i t should be sig n ed b y a m em b er 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 ......................................................................................
a m e m b er o f th e firm ” .
5. T en d ers fro m those o th e r th a n in c o rp o rated b anks and tr u s t com panies o r resp o n sib le and recognized d ealers in invest­
m e n t secu rities w ill be d isre g a rd e d , unless accom panied b y a d e p o sit of 2 p e rc e n t of th e to ta l a m o u n t ( m a tu r ity v a l u e )
of th e T re a s u r y bills applied fo r, o r u nless th e te n d e rs a re accom panied by a n ex p ress g u a r a n ty of fu ll p a y m e n t b y a n
in c o rp o rated b an k o r tr u s t com pany.

6. If the language of this form is changed in any respect, which, in the opinion of the S ecretary of the T re asu ry
m aterial, the tender 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