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F ederal R eserve bank of Dallas F I S 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, TEX AS 7 5 2 2 2 Circular No. 70-66 M arch 18, 1970 NEW OFFERING — TREASURY BILLS To All Banking Institutions and Others Concerned in the Eleventh Federal Reserve District: Your attention is invited to the following statement giving details of two issues of Treasury bills: T he T reasury D epartm ent, by this public notice, invites tenders for two series of Treasury bills to the aggregate am ount of $1,700,000,000, or thereabouts, for cash and in exchange for Treasury bills m aturing M arch 31, 1970, in th e am ount of $1,501,357,000, as follows: 275-DAY B IL L S (to m aturity date) to be issued M arch 31, 1970, in the am ount of $500,000,000, or th e re abouts, representing an additional am ount of bills dated D ecem ber 31, 1969, and to m ature Decem ber 31, 1970, originally issued in the am ount of $1,002,063,000, the additional and original bills to be freely interchangeable. 365-DAY B IL L S for $1,200,000,000, or thereabouts, to be dated M arch 31, 1970, and to m ature M arch 31, 1971. T he 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 $10,000, $50,000, $100,000, $500,000 and $1,000,000 (m atu rity value). T enders will be received a t Federal Reserve Banks and Branches up to th e closing hour, one-thirty p.m., E astern Standard Tim e, Tuesday, M arch 24, 1970. T enders will not be received a t the T reasury D epartm ent, W ashington. Each tender m ust be for an even m ultiple of $10,000, 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 m ay not be used. (N otw ithstanding the fact th a t the oneyear bills will run for 365-days, the discount rate will be com puted on a bank discount basis of 360-days, as is currently the practice on all issues of Treasury bills.) It is urged th a t tenders be m ade on the printed forms and forwarded in the special envelopes which will be supplied by Federal R eserve Banks or Branches on application therefor. B anking institutions generally m ay subm it tenders for account of customers provided th e nam es of the customers are set forth in such tenders. O thers th an banking institutions will not be perm itted to subm it tenders except for th e ir own account. T enders will be received w ithout deposit from incorporated banks and tru st 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 the face am ount of Treasury bills applied for, unless the tenders are accompanied 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 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 the am ount and price range of accepted bids. Only those sub m itting com petitive tenders will be advised of the acceptance or rejection thereof. T he Secretary of the T reasury 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 at the average price (in three decimals) 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 a t the F ederal Reserve B ank on M arch 31, 1970, in cash or other im m ediately available funds or in a like face am ount of T reasury bills m aturing M arch 31, 1970. 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 aturing bills accepted in exchange and the issue price of the new bills. T he 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 T reasury 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 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 R evenue Code of 1954 the am ount of discount a t which bills issued hereunder are sold is not considered 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 th an life insurance com panies) issued hereunder need include in his income tax retu rn 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 th e retu rn is made, as ordinary gain or loss. T reasury D epartm ent Circular No. 418 (current revision) and this notice, prescribe the term s of th e T reasury bills and govern th e conditions of their issue. Copies of the circular may be obtained from any Federal Reserve B ank or Branch. In accordance with the above announcement, tenders wifi be received at this bank an d its branches a t El Paso, Houston an d San Antonio up to twelve-thirty p.m., Central Standard Time, Tuesday, March 24, 1970. Tenders m ay not be entered by telephone. Yours very truly, P. E. Coldwell President (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 TREASURY BILLS 365 DAYS TO MATURITY Maturing March 31,1971 Dated March 31,1970 To: Federal Reserve Bank, Station K, Dallas, Texas 75222 or— The______________________________ Branch El Paso 79999 Houston 77001 (D ate) San Antonio 78206 P u rsu a n t to the provisions of T reasu ry D epartm ent C ircular No. 418 (cu rre n t revision) and the provisions of the public announcem ent issued by the T reasu ry D epartm ent, th e undersigned offers to purchase T reasu ry bills in the am ount shown below, and agrees to pay fo r the am ount allotted, on or before the issue date, by th e method and a t the ra te indicated. NONCOMPETITIVE TENDER $________________________________NOT TO EXCEED $200,000 PLEASE NOTE TENDER MUST B E $10,000 O MULTIPLE R THEREOF Noncompetitive tenders for $200,000 or less from any one bidder, w ithout stated price, will be accepted in full a t the average price (in three decimals) of accepted com petitive bids. / Prices should be expressed on the basis of 1 $ ------------------------------ @ _________ $ ------------------------------------- COMPETITIVE TENDERS ---------------------- @-----------$---------------------------I $___________________ @ _________ $ ________________________ \ e. g., 99.925. F ractions m ust not be used. T E N D E R S MAY NOT BE E N T E R E D BY T E L E P H O N E . T E N D E R S BY W IR E , IF R E C E IV E D B E F O R E T H E CLOSING HOUR, A RE A C C EPT A B L E . Denominations Desired Number of Pieces P aym ent fo r th is issue of bills cannot be made by credit to T reasu ry T ax and Loan Account. M aturity Value 10,000 50,000 @ $ ’100,000 @ T 500,000 @ $i ,000,000 @ $ @$ M ETHOD O F PA Y M E N T ?. $$* 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___________________________ □P aym ent to be made by____________ □ Charge our reserve account on payment date | Draft enclosed (Effectual delivery o f enclosed draft I shall be on latest day which w ill permit presentm ent in order to obtain irrevocably collected funds on paym ent date) (Subscriber's fu ll nam e or corporate title) (Address) By- (Authorized official signature and title) (For the account of, if tender is for another subscriber) (Address) IM PORTANT 1. No tender fo r less th a n $10,000 will be considered and each tender m ust be fo r an am ount in m ultiples of $10,000 (m atu rity value). 2. Tenders should be forw arded in an envelope clearly addressed to this bank or ap pro priate branch as Fiscal A gent of the U nited States, w ith notation on the envelope reading “ T E N D E R FO R T R E A SU R Y O F F E R IN G ”. Since envelopes received w ith th is legend will not be opened u ntil a fte r th e closing time specified in th e public announcem ent, communi cations rela tin g to other m a tte rs should not be enclosed. Envelopes fo r subm itting tenders m ay be obtained from th is bank or appro p riate branch. 3. A ny qualified or conditional tender will be rejected. 4. If a corporation m akes the tender, the form should be signed by an officer of the corporation authorized to m ake th tender and the signing of the form by an officer of th e corporation will be construed as a representation by him th a t he , has been so authorized. If the tender is made by a p artn ersh ip it should be signed by a member of the firm, who " should sign in th e form “_____________________________ , a copartnership, by-------------------------------------------------------------- , a member of th e firm ”. 5. Tenders from those other th a n incorporated banks and tr u s t companies or responsible and recognized dealers in invest m ent securities will be disregarded, unless accompanied by a deposit of 2 percent of the total am ount (m atu rity value) of the T reasury bills applied for, or unless the tenders are accompanied by an express g u ara n ty of full paym ent by an incorporated bank or tr u s t company. 6. If th e language of th is form is changed in any respect, which, in the opinion of th e S ecretary of the T re asu ry is , >-■ m aterial, the ten d er m ay be disregarded. (See reverse for announcement)