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F e d e r a l R e s e r v e Ba n k o f D a lla s F IS C A L A G E N T O F T H E U N IT E D S T A T E S DALLAS, TEXAS 7 5 2 2 2 Circular No. 68-241 November 13, 1968 NEW OFFERING — TREASURY BILLS 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 E leventh F e d e r a l R eserve District: Y our 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 g iv ing d e t a il s of tw o iss u e s o f T re asu 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 Treasury bills m aturing November 21, 1968, in th e am ount of $2,701,648,000, as follows: 91-DAY B IL L S (to m aturity date) to be issued November 21, 1968, in the am ount of $1,600,000,000, or there abouts, representing an additional am ount of bills dated August 22, 1968, and to m ature F ebruary 20, 1969, originally issued in the am ount of $1,101,172,000, 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 November 21, 1968, and to m ature M ay 22, 1969. T h e bills of both series will be issued on a discount basis under com petitive and noncompetitive bidding as hereinafter provided, and a t m atu rity their face am ount will be payable w ithout 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 an d $1,000,000 (m aturity value). T enders will be received a t Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern Standard Time, Monday, November 18, 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 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 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 T enders will be received w ithout deposit from incorporated banks and trust companies and from responsible and recognized dealers in investm ent securities. T enders from others m ust be accompanied by paym ent of 2 percent of th e face am ount of T reasury bills applied for, unless the tenders are accompanied by an express guaranty of paym ent by an incorporated bank or tru st company. Im m ediately after th e 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 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 the T reasury expressly reserves the rig ht 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 Reserve Bank on November 21, 1968, in cash or other im m ediately available funds or in a like face am ount of Treasury bills m aturing November 21, 1968. Cash and exchange tenders will receive equal tre a tm e n t Cash adjustm ents will be m ade for differences between the p ar value of m atur ing bill* 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 th e sale or other disposition of the bills, does not have an y exemption, as such, and loss from the sale or other disposition of T reasury bills does not have any special treatm ent, as such, under th e Internal Revenue Code of 1954. T h e bills are subject to estate, inheritance, gift or other excise taxes, whether Federal or State, but 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 by any local taxing authority. For 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 th e am ount of discount a t which bills issued hereunder are sold is not con sidered to accrue until such bills are sold, redem med or otherwise disposed of, and such bills are excluded from consideration as capital assets. Accordingly, the owner of T reasury bills (other th a n life insurance companies) 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 th e taxable year for which the return is made, as ordinary gain or loss. T reasury D epartm ent Circular No. 418 (cu rrent revision) and this notice, prescribe the term s of the T reasury bills and govern the condition* of th eir 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 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 , Houston a n d S an A n to n io u p to t w 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 , N o v e m b e r 18, 196 8. T en 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 very truly, P. E. Coldw ell P re s id e n t LAST PREVIOUS OFFERING OF TREASURY BILLS Amount, R ange and Approximate Yield of Accepted T enders 91-Day Bills 182-Day Bills D ue F ebru ary 13, 1969 D ue M ay 15, 1969 $2,429,107,000_________ _ ______ __ __ _______ T otal A pplied For__________ ____________________ $1,942,985,000 _ $ 1,600,239,000_________________________________T otal Accepted________________________________ $ 1,100,117,000 Price Yield P rice Yield 98.624___________ 5.444% ..................... ............................... H igh_____________________ 97.186....................... 5.566% 98.609___________ 5.503 % ---------------------------------------- Low______________________ 9 7.160____________ 5.618 % 98.614...................... 5.483% ( 1 ) ------------------------------- Average------------------------------- 97.168.____ _______ 5.602% (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 . 6 4 % for th e 9 1 -d a v b ills th e 1 8 2 -d a y bills. ' a n d 5 8 5 % for (See 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 ADDITION TO TREASURY BILLS 91 DAYS TO MATURITY Maturing February 20,1969 Dated August 22,1968 To: Federal Reserve Bank, Station E , Dallas, Texas 75222 or — The_________________________ ._______Branch E l P a so 79999 H o u sto n 77001 San A n to n io 78206 (Date) Pursuant to the provisions of Treasury Department Circular No. 418 (current revision) and the provisions of the 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. N O N COM PETITIVE T E N D E R $____________________________________ NOT TO EX C EED $200,000 N o n c o m p e titiv e te n d e r s fo r $200,000 or l e s s from a n y on e bidder, w ith ou t st a t e d price, w ill be accep ted in fu ll a t the a v e r a g e price ( in th ree d e c im a ls) o f a c ce p te d c o m p e titiv e bids. if fa ) COM PETITIVE TEN D ER S • ? ®> (a) s . \ Prices should be_ ex pressed on thp basis of 100, with not more than th ree d e c i m a l p laces, e. g ., 99.925. F ra c tio n s must not be used. 1 S T TENDERS MAY NOT BE EN T ER ED BY TELEPHONE. TEN DERS 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 e sir ed Number of Pieces Maturity Value o $ o $ METHOD OF PAYMENT 1,000 $5,000 $- □ ■I® $ 10,000 $.(3) $ 50,000 $. .(5) $ 100,000 $.(5) $ 500,000 $. [J □ □ By m a tu rin g bills held by_____________________ P ay m en t to be m ade by_ C harge our reserve account on pay m en t date D ra ft enclosed (Effectual delivery o f enclosed draft shall he on latest day which will permit presentment In order to obtain irrevocably collected funda on paym ent date) ?1.,000,000 $. Delivery In stru c tio n s : (Subscriber’s full name or corporate title) □ □ □ Hold in Custody A ccount— Member banks fo r own account only Pledge to secure T reasu ry Tax and Loan Account (Address) By- Ship to__________________________ (Authorized official signature and title) (For the account of, if tender is for another subscriber) (Address) 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 OFFERING.” Since envelopes re ceived with this legend will not be opened until after the closing time specified in the public announcement, communica tions 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 at 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, by..................................................................................... 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 for announcement)
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