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F ederal R eserve Ba n k










Circular No. 68-125
May 22, 1968

To All B a n k in g Institutions a n d O th e r s C o n c e r n e d
in t h e

Ele venth F e d e r a l R e serve District:

Your a t t e n t i o n is in v ited to t h e fo llo w in g

s t a t e m e n t giving d e t a i l s of t w o iss u e s of T re as u ry bills:

T he T reasury D epartm ent, by this public notice, invites tenders for two series of T reasury bills to the aggregate am ount of
$2,700,000,000, or thereabouts, for cash and in exchange for T reasury bills m aturing M ay 31, 1968, in th e am ount of
$4,003,990,000, as follows:
90-DAY B IL L S (to m atu rity date) to be issued M ay 31, 1968, in the am ount of $1,600,000,000, or thereabouts,
representing an additional am ount of bills dated February 29, 1968, and to m ature August 29, 1968, originally
issued in the am ount of $1,000,438,000, the additional and original
bills to be freely


182-DAY B IL L S for $1,100,000,000, or thereabouts, to be dated M ay 31, 1968, and to m ature November 29, 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 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).
Tenders will be received a t Federal Reserve B anks and Branches up to the closing hour, one-thirty p.m., E astern
D aylight Saving Tim e, Monday, M ay 27, 1968. T enders will n o t 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, w ith 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 B anks 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 without deposit from incorporated banks and trust companies and from responsible and recognized
dealers in investm ent securities. Tenders from others must 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 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 Reserve Banks and Branches, following which
public announcem ent will be made 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 h e Secretary of the Treasury expressly reserves the
righ t 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 w ithout 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 th e bids m ust be m ade or completed a t the Federal Reserve B ank on M ay 31, 1968, in
cash or other im m ediately available funds or in a like face am ount of Treasury bills m aturing M ay 31, 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 atur­
ing bills accepted in exchange and the issue price of th e new bills.
T h e income derived from T reasury 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, w hether
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 United 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 United 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 such bills are sold, redeemed or otherwise disposed of, and such bills are excluded from consideration as
capital assets. Accordingly, the owner of Treasury bills (o ther than life insurance companies) issued hereunder need include
in his income tax return 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 th e taxable year for which th e
retu rn is made, as ordinary gain or loss.
Treasury D epartm ent Circular No. 418 (current revision) and this notice, prescribe the term s of the T reasury bills and
govern th e 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 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 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 ,
San A n to n io u p to tw e l v e - th ir ty p .m ., C e n tral D ay ligh t S av in g Time, M o n d a y , M a y 27 , 19 6 8 . 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 .
Yours v e r y truly,

ouston a n d

P. E. C old w ell
P re s id e n t
Amount, Range an d Approxim ate Yield of Accepted Tenders
91-Day Bills
182-Day Bills
D ue August 22, 1968
D ue November 21, 1968
$2,525,952,000-----------------------------------------------T otal Applied F o r------------- --------------------------------- $2,149,739,000
$1,600,522,000-------------------------------------------------T otal A ccepted________________________________ $1,100,019,000
5.800% .................... ....... ...................... H igh______________________ 96.985___________ 5.964%
98.517____________ 5.867% _______________ __________.Low______________________ 96.959___________ 6.015%
5.847% (1)
________ ____ __ Average____________________ 96.969________ __ 5.995% (1 )


T h e s e rates a re on a bank discount basis. T h e e q u iv a le n t cou p on issu e y ie ld s are 6 . 0 2 % for t h e 9 1 - d a y bills, a n d 6 . 2 7 % for

t h e 1 8 2 - d a y b ills .

(See reverse side for tender form)

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


Dated May 31,1968

Maturing November 29, 1968

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

Houston 77001

San Antonio 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 am ount
shown below, and agrees to pay for the amount allotted, on or before the issue date, by the method and a t the rate indicated.

_NOT TO EXCEED $200,000


N o n co m p etitiv e tenders for $200,000 or le s s from any- one bidder, w ith o u t sta te d price, w ill be accepted in fu ll a t th e a v e r a g e
price (in three d e c im a ls) o f accep ted co m p etitiv e bids.

---------------------------C O M P E T IT IV E T E N D E R S / «


-@ -

Prices should be ex­
pressed on the basis of
100, with not more than
th r e e decim al p la c e s ,
e. g., 99.325. Fractions

must not be used.

Payment fo r 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 e sir ed
Number of

Maturity Value

(cb $
.& $
(S> $

1,000 ?.
5,000 $-


10,000 $50,000 $-


(5) $
.& $ 100,000 ?<> $ 500,000 s


By m aturing bills
held by__________________________ ____
Paym ent to be made by______________
Charge our reserve account on paym ent
D raft enclosed ( E f f e c t u a l d e i i v e r y o f e n c l o s e d
draft shall be on latest day which will permit pr e se n t­
ment in order to obtain irrevocably collected funds on
payment date)

? i ,000,000 $-

Delivery Instructions:

Pledge to secure Treasury Tax and
Loan Account

( S u b s c r i b e r ’s f u l l n a m e o r c o r p o r a t e t i t l e )

Hold in Custody Account— Member
banks for own account only




Ship to___________________________

(Authorized official signature and title)

(For the account of, if tender is for another subscriber)



1. No tender for less than $1,000 will be considered and each tender must be for an amount in multiples of $1,000 (m aturity
2. Tenders should be forwarded in an envelope clearly addressed to this bank or appropriate branch as Fiscal Agent of th e
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 m atters 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
corporation authorized to make t
tender and the 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 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”.
5. Tenders from those other than incorporated banks and tru st companies or responsible and recognised dealers in in vest­
ment securities will be disregarded, unless accompanied by a deposit of 2 percent of the total amount (m aturity v alue)
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)

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