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F ed er 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 75222 Circular No. 72-22 February 1, 1972 NEW OFFERING — TREASURY BILLS To All Banking Institutions a n d Others Concerned in the Eleventh Federal Reserve District: Your attention is invited to the following sta te m e n t giving details of tw o issues of Treasury bills: T h e Treasury Departm ent, by this public notice, invites tenders for two series of Treasury bills to the aggregate amount of $3,900,000,000, or thereabouts, for cash and in exchange for Treasury bills maturing February 10, 1972, in the am ount of $3,900,325,000, as follows: 91-D A Y B IL L S (to m aturity date) to be issued February 10, 1972, in the am ount of $2,300,000,000, or there abouts, representing an additional am ount of bills dated Novem ber 11, 1971, and to mature M ay 11, 1972 (C U S IP No. 912793 N A 0 ), originally issued in the amount of $1,600,710,000, the additional and original bills to be freely interchangeable. 182-D A Y B IL L S for $1,600,000,000, or thereabouts, to be dated February 10, 1972, and to mature August 10, 1972 (C U S IP No. 912793 N Y 8 ). 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 at maturity their face am ount will be payable w ithout interest. T h ey w ill be issued in bearer form only, and in denom inations of $10,000, $15,000, $50,000, $100,000, $500,000 and $1,000,000 (m aturity v a lu e). T enders w ill be received at Federal R eserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern Standard T im e, M onday, February 7, 1972. Tenders w ill not be received at the Treasury Departm ent, Washington. Each tender m ust be for a m inim um of $10,000. Tenders over $10,000 m ust be in m ultiples of $5,000. In the case of com petitive tenders the price offered m ust be expressed on the basis of 100, with not more than three decim als, e.g., 99.925. Fractions m ay not be used. It is urged that tenders be m ade on the printed forms and forwarded in the special envelopes which w ill be supplied by Federal Reserve Banks or Branches on application therefor. B anking institutions generally m ay subm it tenders for account of customers provided the nam es 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 com panies and from responsible and recognized dealers in investm ent securities. Tenders from others m ust be accom panied by paym ent of 2 percent of the face am ount of Treasury bills applied for, unless the tenders are accom panied by an express guaranty of paym ent by an incorporated bank or trust company. Im m ediately after the closing hour, tenders will be opened at the Federal R eserve Banks and Branches, follow ing which public announcem ent will be made by the Treasury D epartm ent of the amount and price range of accepted bids. O nly those subm itting com petitive 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. Sub ject to these reservations, noncom petitive tenders for each issue for $200,000 or less without stated price from any one bidder will be accepted in full at the average price (in three decim als) of accepted com petitive bids for the respective issues. Settlem ent for accepted tenders in accordance with the bids m ust be m ade or com pleted at the Federal R eserve B ank on February 10, 1972, in cash or other im m ediately available funds or in a like face am ount of Treasury bills maturing February 10, 1972. Cash and exchange tenders will receive equal treatment. Cash adjustm ents w ill be m ade for differences betw een the par value of maturing bills accepted in exchange and the issue price of the new bills. Under Sections 454 ( b ) and 1221 ( 5 ) of the Internal R evenue Code of 1954 the am ount of discount at which bills issued hereunder are sold is considered to accrue when the bills are sold, redeem ed or otherwise disposed of, and the bills are excluded from consideration as capital assets. Accordingly, the owner of Treasury bills (other than life insurance com panies) issued here under m ust include in his incom e tax return, as ordinary gain or loss, the difference between the price paid for the bills, whether on original issue or on subsequent purchase, and the am ount actually received either upon sale or redem ption at m aturity during the taxable year for which the return is made. Treasury D epartm ent Circular No. 418 (current revision) and this notice, prescribe the term s of the Treasury bills and govern the conditions of their issue. Copies of the circular m ay be obtained from any Federal R eserve Bank or Branch. In acc orda n c e with the a b o v e a n n o u n c e m e n t, ten d ers will be received a t this b a n k a n d its bran ches a t El Paso, Houston a n d San Antonio up to twelve-thirty p.m., Central S ta nd a rd Time, M o n day , February 7, 1972. Tenders m ay not be e n te re d by te le p h o n e . Yours very truly, P. E. Coldwell President LAST PREVIOUS OFFERING OF TREASURY BILLS Amount, Range and Approxim ate Y ield of A ccepted Tenders 91-D ay B ills 182-D ay B ills D u e M ay 4, 1972 D ue August 3, 1972 $3,846,490,000 Jflg? T otal A pplied For_________________________________ $2,802,225,000 $2,300,475,000__________________________________ T otal_A ccepted___________________________________ $1,600,025,000 Price Y ield Price Y ield 99.160------------------ 3.323% ____________________________H igh _______________________ ‘ 98.130 3.699% 99.142------------------ 3.394% ____________________________ Low________________________ 98.097____________ 3.764% 99.149 ------------------ 3.367% ( 1 ) _____________________ Average______________________ 98.1 1 3 ____________ 3.733% (1 ) ( 1 ) T h ese rates are on a b ank d iscou nt basis. T h e eq u iv a le n t coupon issue y ie ld s are 3 .4 5 % for th e 9 1 -d a y b ills and 3 .8 7 % for the 1 8 2 -day bills. (S e e reverse 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 TREASURY BILLS 182 DAYS TO MATURITY Dated February 10,1972 Maturing August 10,1972 To: Federal Reserve Bank, Station K, Dallas, Texas 75222 or — The----------------------------------- Branch El Paso 79999 Houston 77001 San Antonio 78295 (D a t e ) 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 at the rate indicated. NONCOMPETITIVE TENDER $________________________________ _NOT TO EXCEED $200,000 Noncompetitive tenders for $200,000 or less from any one bidder, without stated price, will be accepted in full at the average price (in three decimals) of accepted competitive bids. Prices should be ex pressed on the basis of m 100, with not more th an COMPETITIVE TENDERS '$ ___________ v----------------------------------th re e decim al p la c e s, # e. g., 99.925. Fractions « ----------------------------------P must not be used. t$---------s g r 5 TENDERS MAY NOT BE ACCEPTED BY TELEPHONE. TENDERS BY WIRE, IF RECEIVED BEFORE THE CLOSING HOUR, ARE ACCEPTABLE. ---------- -@ - Denominations Desired N u m b er o f p ieces Payment for this issue of bills cannot be made by credit to Treasury Tax and Loan Account. ’ METHOD OF PAYMENT M atu rity V a lu e -@ $ 1 0 , 0 0 0 $ __________________ _@ $ 15,000 $____________ $ 50,000 $____________ .<§> $ 1 0 0 , 0 0 0 $ __________________ □ □ □ _@ $ 500,000 $____________ $1,000,000 $_____________ Delivery Instructions: □ Hold in Custody Account—Member banks for own account only □ Pledge to secure Treasury Tax and Loan Account □ Ship to------------------------------------- By maturing bills held by___________________ Payment to be made by_ I I Charge our reserve account on payment date Draft e n c l o s e d (E ffe c tu a l d elivery o f en closed d r a f t shall be on late st day w h ich w ill p erm it p r e s e n tm e n t in order to o b tain irrevocab ly collected fu n d s on p a y m e n t d ate) (S u b scrib e r’s fu ll n a m e or corp o r a te t it le ) (A d d re ss) By(A u th o rized official sig n a tu r e an d title ) ( F o r th e a c c o u n t o f, i f ten d er is fo r a n o th e r su b scrib er) (A d d re ss) IMPORTANT 1. No tender for less than $10,000 will be considered and each tender over $10,000 must be for an amount in multiples of $5,000 (m aturity value). 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 OFFERING”. Since envelopes received with this legend will not be opened until after the closing time specified in the public announcement, communi cations relating to other m atters should not be enclosed. Envelopes for submitting tenders may be obtained from th is 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 th e tender and the signing of the form by an officer of the corporation will be construed as a representation by him th at 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 tru st 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 (m aturity 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 tru st 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)