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FEDERAL RESERVE BANK OF DALLAS FIS C A L A G EN T O F TH E UN ITED STA T E S DALLAS, TEXAS 75222 C ir c u la r N o. 68-91 A p ril 10, 1968 NEW OFFERING — TREASURY BILLS 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 E le v en th F e d e r a l Rese rve District: Your attention 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 t w o is s u e s of T re as u ry bills: T h e T reasury D epartm ent, by thi« public notice, invites tenders for two series of T reasury bills to th e aggregate am ount of $2,700,000,000, or thereabouts, for cash and in exchange for T reasury bills m aturing April 18, 1968, in th e am ount of $2,502,288,000, as follows: 91-DAY BILLS (to m aturity date) to be issued April 18, 1968, in the am ount of $1,600,000,000, or thereabouts, representing an additional am ount of bills dated January 18, 1968, and to m ature Ju ly 18, 1968, originally issued in the am ount of $1,000,753,000, the additional and original bills to be freely interchangeable. 182-DAY B IL L S for $1,100,000,000, or thereabouts, to be dated April 18, 1968, and to m ature October 17, 1968. T h e bills of both series will be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided, and a t m atu rity their face am ount will be payable without interest. T hey will 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 value). T enders will be received a t Federal Reserve B anks and Branches up to the closing hour, one-thirty p.m., E astern Standard Tim e, M onday, April 15, 1968. Tenders will not be received a t the T reasury D epartm ent, Washington. Each tender must be for an even m ultiple of $1,000, and 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 may 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 Reserve B anks or Branches on application therefor. Banking institutions generally may 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. Tenders will be received without 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 te n d e n are accompanied by an express guaranty of paym ent by an incorporated bank or tru st company. Im m ediately after the closing hour, tenders will be opened a t the Federal R eserve B anks and Branches, following which public announcem ent will be made by the Treasury 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 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. Subject to these reservations, noncompetitive tenders for each issue for $200,000 or less without stated price from any one bidder will be accepted in full a t the 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 com pleted a t the Federal R eserve Bank on April 18, 1968, in cash or other im mediately available funds or in a like face am ount of Treasury bills m aturing April 18, 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 he 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 he bills are subject to estate, inheritance, gift or other excise taxes, whether Federal or State, but are exempt 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 at which Treasury bills are originally sold by the U nited States is considered to be interest. Under 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 euch bills are sold, redeemed 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 income tax return only the difference between 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 a t m aturity during the taxable year for which the return is made, as ordinary gain or loss. T reasury D epartm ent Circular No. 418 (curren t revision) and this notice, prescribe the term s of the T reasury bills and govern the conditions of their issue. Copies of the circular may be obtained from any Federal Reserve Bank 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 rec eiv 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 , H ouston a n d San A n to n io u p to tw e l v e - th ir ty p .m ., Centr al S t a n d a r d Time, M o n d a y , April IS, 196 8. T e n d e rs m a y n o t b e entered by telephone. Yours v ery truly, P. E. Coldwell P re s id e n t LAST PREVIOUS OFFERING OF TREASURY BILLS Amount, R ange and Approximate Yield of Accepted Tenders 91-Day Bills 182-Day Bills D ue July 11, 1968 D ue October 10, 1968 $2,394,243,000_______________________________ T otal Applied For---------------------------------------------- $1,883,329,000 $1,600,043,000________________________________ T otal Accepted------------------------------------------ $1,000,316,000 Price Yield Price Yield 98.673___________ 5.250%_----- -------------------------------- .H igh---------------------------------97.286___________ 5.368% 98.649___________ 5.345% -------------------------------- -------- Low______________________ 97.260___________ 5.420% 98.658___________ 5.309% ( 1 ) ------------------------------- Average____________________ 97.270___________ 5.400% (1 ) ( 1 ) T h e s e rate s a re on t h e 1 8 2 - d a y b i lls . a b a n k d is c o u n t b asis. T h e e q u iv a l e n t c o u p o n issu e y i e l d s a r e 5 . 4 6 % f o r t h e 9 1 - d a y bills, a n d 5 . 6 3 % foi (See reveroe aide 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 ADDITION TO TREASURY BILLS 91 DAYS TO MATURITY D ated Ja n u a ry 18, 1968 Maturing July 18, 1968 To: Federal Reserve Bank, Station K, Dallas, Texas 75222 or — The_________________________________Branch £1 P a so 79999 H o u sto n 77001 S a n A n to n io (D.ta) 78206 Pursuant to the provisions of Treasury Department Circular No. 418 (current revision) and the provisions of th e 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. _NOT TO EX CEED $200,000 NONCOM PETITIVE T E N D E R $_ N o n co m p etitiv e te n d e r s fo r $200,000 or le s s from a n y one bidder, w ith o u t sta te d price, w ill be accep ted in f u ll a t the a v e r a g e price (in three d e c im a ls) o f a ccep ted c o m p e titiv e bids. COMPETITIVE TEN D ER S \ ¥ $ Prices should be ex pressed on the basis of 100, with not more than th ree decim al p la ce s, e. g., 99.925. Fractions must not be used. ¥ @ a^=TEN D EE S MAY NOT BE ENTERED BY TELEPHONE. TENDERS BY WIRE, IF RECEIVED BEFORE THE CLOSING HOUR, ARE ACCEPTABLE. Payment for this issue of bills cannot be made by credit to Treasury Tax and Loan Account. D e n o m in a tio n s D esired Number o f Pieces Maturity Valu« ■< > $ 8 $ 5,000 $- <> $ 8 METHOD OF PAYMENT 1,000 $. 10,000 ?50,000 $■ $ □ □ By m atu rin g bills held b y _____________________________ P a y m en t to be m ade by_____________ $ 100,000 $■ $ 500,000 ?. □ Charge our reserve account on paym ent date |_J D ra ft enclosed ( E f f e c t u a l d e liv e r y o f e n c lo s e d . 0 $1,000,000 $- d r a f t shall be on la te st day which will p e rm it p re s e n t m e n t in ord er to o btain irrevocably collected fu nd a o n p a y m e n t date) Delivery In stru ctio n s: □ □ Pledge to secure T reasury Tax and Loan Account (S ubscriber’s full n am e or co rp o rate title) Hold in Custody Account— M ember banks fo r own account only □ (Address) B y- Ship to----------------------------------------- (A uthorized official s ig n a tu re an d title) (F o r th e account o f, if te n d e r is for a n o th e r subscriber) (A ddress) IM P O R T A N T 1. No tender for less than $1,000 will be considered and each tender must be for an amount in multiples of $1,000 (maturity value). 2. 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 BILLS”. Since envelopes received with this legend will not be opened until after the closing time specified in the public announcement, communications relating to other matters should not be enclosed. Envelopes for submitting tenders may be obtained from this bank or appropriate branch. 3. Any qualified or conditional tender will be rejected. 4. 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, b y .................. - ............................................................. , a member of the firm”. 5. Tenders from those other than incorporated banks and trust companies or responsible and recognized dealers in invest 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. 6. 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 fo r announcem ent)