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F ederal Reserve Bank of Dallas F IS C A L A G E N T O F T H E U N ITE D S T A T E S DALLAS, TEXAS 75222 Circular No. 68-26 January 31, 1968 NEW OFFERING — TREASURY BILLS To All B a n k i n g Institutions a n d O th ers C o n c e r n e d in t h e E leventh F e d e r a l R e serv e District: Your a t t e n t i o n is in v ite d to th e fo llo w in g s t a t e m e n t giving d e t a i l s of tw o iss u e s 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 $2,500,000,000, or thereabouts, for cash and in exchange for T reasury bills m aturing February 8, 1968, in th e am ount of $2,501,967,000, as follows: 91-DAY B IL L S (to m aturity date) to be issued February 8, 1968, in the am ount of $1,500,000,000, or there abouts, representing an additional am ount of bills dated November 9, 1967, and to m ature M ay 9, 1968, originally issued in the am ount of $1,000,647,000, the additional and original bills to be freely interchangeable. 182-DAY B IL L S for $1,000,000,000, or thereabouts, to be dated February 8, 1968, and to m ature August 8, 1968. T he bills of both series will be issued on a discount basis under competitive 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 denominations of $1,000, $5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000 (m aturity value). Tenders will be received a t Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., E astern Standard Tim e, M onday, February 5, 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 th e 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. 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. B anking institutions generally m ay 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. Tenders will be received w ithout deposit from incorporated banks and trust companies and from responsible and recognized dealers in investm ent securities. Tenders 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 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 a t the Federal Reserve B anks 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 h e 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, noncompetitive tenders for each issue for $200,000 or less without stated price from any one bidder will be accepted in full a t th e 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 m ade or completed a t the Federal R eserve B ank on February 8, 1968, in cash or other im m ediately available funds or in a like face am ount of T reasury bills m aturing February 8, 1968. Cash and exchange tenders will receive equal treatm ent. Cash adjustm ents will be m ade for differences between the par value of m atur ing bills accepted in exchange and the issue price of th e new bills. T h e 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 th e Internal Revenue 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 imposed on the principal or interest thereof by any State, or any of the possessions of the United States, or by any local taxing authority. F o r purposes of taxation the am ount of discount a t which Treasury 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 the 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 Treasury bills (other than life insurance companies) 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 th e am ount actually received either upon sale or redem ption a t m aturity during the taxable year for which the retu rn is made, as ordinary gain or loss. Treasury D epartm ent Circular No. 418 (current 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 Federal Reserve Bank 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, a n d S an A n to n io u p to tw e lv e - th ir ty p .m .. C e ntral S t a n d a r d Time, M o n d a y , F eb r u a r y 5, 19 68 . T e n 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 . Houston Yours v e r y truly, W a tr o u s H. Irons P re sid e n t LAST PREVIOUS OFFERING OF TREASURY BILLS Amount, Range and A pproxim ate Yield of Accepted Tenders 91-Day Bills 182-Day Bills D ue M ay 2, 1968 D ue August 1, 1968 $2,469,851,000____________________________ _ T o t a l Applied F o r______________________________ $1,918,134,000 $1,500,206,000________________________________ T otal Accepted________________________________ $1,000,052,000 P rice Yield Price Yield 98.783 4.815% _________________________ H igh______________________ 97.515____________4.915% 98.767 4.878% _________ ______ __________ Xow ______________________ 97.478_____ ___ ___4.989% 98.775 4.846% ( 1 ) ____________________ Average_____________________97.494____________4.957% (1 ) (X) T h e s e rates are on a b a n k discou nt basis. T h e eq u iv a le n t coupon issue yie ld s are 4 .9 9 % for th e 9 1 -d a y bills, and 5 .1 7 % for th e 18 2 -d a y bills. (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 182 DAYS TO MATURITY Dated February 8,1968 Maturing August 8,1968 To: Federal Reserve Bank, Station K, Dallas, Texas 75222 or — Th e_________________________________ Branch £1 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. _NOT TO EXCEED $200,000 NONCOMPETITIVE TENDER $_ 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 ^S. $ - ------ vw--@ @ Prices should be ex pressed on the basis of 100, with not more than th re e decim al places, e. g., 99.925. Fractions must not be used. $ $ [gif’TENDERS MAY NOT BE ENTERED BY TELEPHONE. TENDERS BY WIRE, IF RECEIVED BEFORE THE CLOSING HOUR, ARE ACCEPTABLE. Denominations Desired Number o f Pieces Payment for this issue of bills cannot be made by credit to Treasury Tax and Loan Account. M aturity Value ® ? (® $ (?) ? METHOD OF PAYMENT 1,000 □ 5,000 $10,000 $■ □ (ffl ? 50,000 ?. (a) $ 100,000 $(a) $ 500,000 * By maturing bills held by_____________________________ Payment to be made by_____________ □ Charge our reserve account on payment date | | Draft enclosed ( E f f e c t u a l d e liv e r y o f enclosed d ra ft shall be on latest day which will p e rm it p re s e n t m e n t in order to obtain irrevocably collected fu n d s on p ay m en t date) ?1.,000,000 Delivery Instructions: □ □ Pledge to secure Treasury Tax and Loan Account (S ubscriber’s full n a m e or c o rp o ra te title) Hold in Custody Account— Member banks for own account only □ (Address) By. (A uthorized official s ig n a tu re a n d title) Ship to___________________________ (F or th e account of, if te n d e r is fo r a n o th e r su b scrib er) (A ddress) 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 (m aturity 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 BILLS”. Since envelopes received with this legend will not be opened until after the closing time specified in the public announcement, communications relating to other m atters 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 th a t 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 .................................. .......................................... t 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 (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 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 fo r announcem ent)