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F ederal Reserve Ba nk o f Dallas 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 75222 Circular No. 69-27 February 5, 1969 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 Eleventh F e d e r a l R eserv e District: Y ou r a t t e n t i o n is in v ited to th e fo llo w in g s t a t e m e n t g iv in g d e t a il s of t w o iss u es 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 $2,700,000,000, or thereabouts, for cash an d in exchange for T reasury bills m aturing February 13, 1969, in th e am ount of $2,704,449,000, as follows: 91-DAY B IL L S (to m aturity date) to be issued February 13, 1969, in the am ount of $1,600,000,000, or there abouts, representing an additional am ount of bills dated N ovember 14, 1968, and to m ature M ay IS, 1969, originally issued in the am ount of $1,102,720,000, 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 F ebruary 13, 1969, and to m ature August 14, 1969. T h e bills of both series will be issued on a discount basis under com petitive 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 denom inations of $1,000, $5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000 (m atu rity v alue). Tenders will be received a t Federal Reserve B anks and Branches up to the closing hour, one-thirty p.m., E astern S tandard Tim e, M onday, February 10, 1969. T enders will not be received a t the T reasury D epartm ent, Washington. Each tend er 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 tha n three decimals, e.g., 99.925. Fractions m ay not be used. I t is urged th a t 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 m ay subm it tenders for account of customers provided th e names of the customers are set forth in such tenders. Others th an banking institutions will not be perm itted to subm it tenders except for th eir 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 accom panied 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 afte r the closing hour, tenders will be opened a t the F ederal R eserve 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 th e acceptance or rejection thereof. T he Secretary of th e 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, 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 decim als) of accepted com petitive bids for th e respective issues. S ettlem ent for accepted tenders in accordance w ith th e bids m ust be made or com pleted a t the F ederal Reserve B ank on F ebruary 13, 1969, in cash or other im m ediately available funds or in a like face am ount of Treasury bills m aturing F ebruary 13, 1969. Cash and exchange tenders will receive equal treatm ent. Cash adjustm ents will be m ade for differences between the p a r value of m atur ing bills accepted in exchange and the issue price of th e 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 T reasury bills does not have any special treatm ent, as such, under the Internal R evenue Code of 1954. T h e bills are subject to estate, inheritance, gift or other excise taxes, whether F ederal 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 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 in te re st U nder Sections 454 (b ) and 1221 (5 ) of th e 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, redeem ed or otherwise disposed of, and such bills are excluded from consideration as capital assets. Accordingly, the owner of T reasury 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, 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 ent Circular No. 418 (cu rrent revision) and this notice, prescribe the term s of th e T reasury bills and govern the conditions of their issue. Copies of the circular may be obtained from any F ederal 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 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, H ousto n a n d San A n to n io u p to tw 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 , F e b r u a r y 10, 1969. 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 . Yours very truly, P. E. C oldwell P re sid e n t LAST PREVIOUS OFFERING OF TREASURY BILLS Amount, R ange and Approxim ate Yield of A ccepted T enders 91-Day Bills D ue M ay 8, 1969 $2,797,471,000____________ $1,600,485,000_____________ Price Yield 98.429______ -6.215% . 98.417______ ..6.262%.. 98.420______ ..6.251% (1 ) . _.__ ___ T o tal A pplied For_ _ __________T otal Accepted__ ....High.... __ Low__ ..Average.. 182-Day Bills D ue August 7, 1969 __________________ $2,189,171,000 __________________ $1,100,024,000 Price Yield .... 96.8 0 0 ________________6.330% —.96.781 ........ ......................6.367% __ 96.785_____ _____ ...6.359% (1 ) ( 1 ) T h e s e r a t e s a r e on a h a n k d i s c o u n t b asis. T h e e q u i v a l e n t c o u p o n issu e y ie ld s a re 6 - 4 4 % t h e 1 8 2 - d a y b i lls . f o r t h e 9 1 - d a y b ills, a n d 6 . 6 6 % for (See reverse sid for tender form e ) This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) TENDER FOR TREASURY BILLS 182 DAYS TO MATURITY Dated February 13, 1969 Maturing August 14, 1969 To: Federal Reserve Bank, Station K, Dallas, Texas 75222 or— Th e ________________________________ Branch El Paso 79999 Houston 77001 San Antonio 78206 (D ate) 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 C O M P E T I T I V E T E N D E R $_ J N O T T O E X C E E D $200,000 Noncompetitive tenders for $200,000 or less from any one bidder, without stated price, will be accepted in full at the average price (in three decimals) of accepted competitive bids. _ _ $ (tD I @ $ $ l\ COMPETITIVE T E N D E R S V ... Prices should be e x pressed on the basis of 100, with not more than th ree decim al p laces, e. g., 99.925. Fractions must not be used. K§r" TENDERS MAY NOT BE ENTERED BY TELEPHONE. TENDERS BY WIRE, IF RECEIVED BEFORE TH E CLOSING HOUR, ARE ACCEPTABLE. Payment for this issue of bills cannot be made by credit to Treasury Tax and Loan Account. Denominations Desired N u m b e r of Pieces Maturity Value METHOD OF PAYMENT □ $ 1,000 $5,000 $- B y maturing bills held by ____________________ (at $ 10,000 ?. □ P a y m e n t to be m a d e by_ (a) $ 50,000 $. 100,000 $- □ Charge our reserve account on p a y m e n t date (a ) ( iii m $ $ 500,000 $. (a) $1 ,000,000 ?(a) $ I J Draft enclosed _ (Effectual delivery of enclosed d r a ft shall be on latest day which wiU p e rm it p re s e n tm e n t in order to o btain irrevocably collected funds on payment date) Delivery Instructions: (Subscriber’s full name or corporate title) □ Hold in Custody Account— M e m b e r banks for o w n account only □ Pledge to secure Treasury T a x and Loan Account □ Ship to__________________________ (Addresa) By(Authorized official signature and title) (For the account of, if tender is for another subscriber) (Address) IMPORTANT 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, communi cations 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. i . 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. G . If th e language of this form is changed in any respect, which, in the opinion of the S ecretary of the T reasury is m a te rial, the tender m ay be disregarded. (See reverse fo r announcem ent)