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F ederal Reserve 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, TEXAS 75222 Circular No. 70-194 August 18, 1970 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 statement giving details of two issues of Treasury bills: T he Treasury D epartm ent, by this public notice, invites tenders for two series of Treasury bills to the aggregate am ount of $3,200,000,000, or thereabouts, for cash and in exchange for Treasury bills m aturing August 27, 1970, in the am ount of $3,102,755,000, as follows: 92-D A Y B IL L S (to m aturity date) to be issued August 27, 1970, in the am ount of $1,800,000,000, or thereabouts, representing an additional am ount of bills dated M ay 28, 1970, and to mature N ovem ber 27, 1970, originally issued in the am ount of $1,300,780,000, the additional and original bills to be freely interchangeable. 182-DA Y B IL L S for $1,400,000,000, or thereabouts, to be dated August 27, 1970, and to mature February 25, 1971. T he bills of both series w ill be issued on a discount basis under com petitive and noncom petitive bidding as hereinafter provided, and at m aturity 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, $50,000, $100,000, $500,000 and $1,000,000 (m aturity v a lu e). Tenders w ill be received at Federal R eserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern D aylight Saving T im e, M onday, August 24, 1970. Tenders will not be received at the Treasury Departm ent, Washington. 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 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 will be supplied by Federal R eserve Banks or Branches on application therefor. Banking 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 accou n t 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 w ill be opened at the Federal R eserve Banks and Branches, follow ing which public announcem ent w ill be made by the Treasury Departm ent of the am ount and price range of accepted bids. O nly those subm itting com petitive tenders w ill be advised of the acceptance or rejection thereof. T h e 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 made or com pleted at the Federal Reserve Bank on August 27, 1970, in cash or other im m ediately available funds or in a like face amount of Treasury bills m aturing August 27, 1970. Cash and exchange tenders will receive equal treatm en t Cash adjustm ents will be m ade for differences betw een the par value of matur ing bills accepted in exchange and the issue price of the new bills. T he incom e derived from Treasury bills, whether interest or gain from the sale or other disposition of the bills, does not have any exem ption, 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 R evenue Code of 1954. T he 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 im posed 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 at which Treasury bills are originally sold by the U n ited States is considered to be interest. 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 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 Treasury bills (other than life insurance com panies) issued hereunder need include in his incom e 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 at m aturity during the taxable year for which the return is made, as ordinary gain or loss. Treasury D epartm ent Circular No. 418 (current revision) and this notice, prescribe the terms of the Treasury bills and govern the conditions of their issue. Copies of the circular m ay be obtained from any Federal Reserve B ank or Branch. In accordance with the above announcement, tenders will be received at this bank a n d its branches a t El Paso, Houston and San Antonio up to twelve-thirty p.m., Central Daylight Saving Time, Monday, August 24, 1970. Tenders may not be entered by telephone. Yours very truly, P. E. Coldwell ______________ President LAST PREVIOUS OFFERING OF TREASURY BILLS Am ount, R ange and Approxim ate Y ield of A ccepted Tenders 91-D ay B ills 182-D ay B ills D u e N ovem ber 19, 1970 D u e February 18, 1971 $2,943,180,000 T otal A pplied For_________________________________ $2,517,490,000 $1,800,290,000-----------------------------------------------------T otal A ccepted___________________________________$1,500,070,000 P rice Y ield Price Y ield 98.365 6.468% ------------------------------------------H igh_______________________ 96.678____________ 6.571% 98.346 6.543% ------------------------------------------ Low ________________________96.662____________ 6.603% 98.350 6.527% ( 1 ) --------------------------------- A verage----------------------------------96.670____________ 6.587% (1 ) ( 1 ) These rates are on a bank discount basis. T he equivalent coupon issue yields are 6.73% for the 91-day bills and 6 .91% for the 182-day bills. ' (See 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 ADDITION TO TREASURY BILLS 92 DAYS TO MATURITY Maturing November 27,1970 Dated May 28,1970 To: Federal Reserve Bank, Station K, Dallas, Texas 75222 or — __ Branch The El Paso 79999 Houston 77001 San Antonio 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. NONCOMPETITIVE TENDER $____________________________________ NOT TO EXCEED $200,000 Noncompetitive tenders for $200,000 or less from any one bidder, without stated price, will be accepted in full at the average price (in three decimals) of accepted competitive bids. COMPETITIVE TENDERS '$ $ Prices should be ex pressed on the basis of 100, with not more than th ree d ecim als p la ce s, e. g., 99.925. Fractions must not be used. $ @ $ d ® 3 TENDERS MAY NOT BE ACCEPTED BY TELEPHONE. TENDERS BY WIRE, IF RECEIVED BEFORE THE CLOSING HOUR, ARE ACCEPTABLE. Denominations Desired Number of Pieces Payment for this issue of bills cannot be made by credit to Treasury Tax and Loan Account. METHOD OF PAYMENT M aturity Value $ 10,000 $_ $ 50,000 $_ _@ $ 100,000 $_ _@$ 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--------------------- □ Charge our reserve account on payment date [ | Draft enclosed (Effectual delivery of enclosed d ra ft shall be on latest day which will perm it presentm ent in order to obtain irrevocably collected funds on paym ent date) (Subscriber’s full nam e or corporate title) (Address) By- (Authorized official signature and title) (For the account of, if tender is for another subscriber) (Address) IMPORTANT 1. No tender for less than $10,000 will be considered and each tender must be for an amount in multiples of $10,000 (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 received 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. 4. If a corporation makes the tender, the form should be signed by an officer of the corporation authorized to^ make the tender and 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)