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F ederal R eserve Bank of Dallas F IS C A L A G E N T O F T H E U N IT E D ST A T E S DALLAS, TEXAS 7 5 2 2 2 Circular No. 68-136 June 12, 1968 NEW OFFERING — TREASURY BILLS To All B a n k in g Institutions a n d O th ers C o n c e r n e d in t h e Ele venth F e d e r a l R eserve District: Your a t t e n t i o n is in vite d to th e f o llo w in g s t a t e m e n t giv ing d e t a i l s of tw o issues 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 and in exchange for T reasury bills m aturing Ju n e 20, 1968, in the am ount of $2,606,310,000, as follows: 91-DAY B IL L S (to m aturity date) to be issued Ju n e 20, 1968, in the am ount of $1,600,000,000, or thereabouts, representing an additional am ount of bills dated March 21, 1968, and to m ature Septem ber 19, 1968, originally issued in th e am ount of $1,000,051,000, 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 Ju n e 20, 1968, and to m ature D ecember 19, 1968. T he bills of both series will be issued on a discount basis under com petitive and noncompetitive bidding as hereinafter provided, and a t m aturity their face am ount will be payable without 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 atu rity value). Tenders will be received a t Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern D aylight Saving Tim e, Monday, Ju n e 17, 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 the case of com petitive tenders th e 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 Banks or Branches on application therefor. Banking 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 without deposit from incorporated banks and tru st companies and from responsible and recognized dealers in investm ent securities. Tenders from others must be accompanied b y paym ent of 2 percent of the face am ount of T reasury bills applied for, unless th e 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 Banks and Branches, following which public announcem ent will be made by the Treasury D epartm ent of the am ount and price range of accepted bids. Those subm itting tenders will be advised of the acceptance or rejection thereof. T h e Secretary of the Treasury expressly reserves th e 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 w ithout stated price from any one bidder will be accepted in full at the 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 th e Federal Reserve B ank on June 20, 1968, in cash or other im m ediately available funds or in a like face am ount of Treasury bills m aturing Ju ne 20, 1968. Cash and exchange tenders will receive equal treatm ent. Cash adjustm ents will be m ade for differences between th e p ar value of m atur ing bills accepted in exchange and the issue price of the new bills. T h e income derived from T reasury bills, w hether interest or gain from th e sale or other disposition of the bills, does not have any exemption, 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 Revenue Code of 1954. T he bills are subject to estate, inheritance, gift or other excise taxes, whether 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 United States, or by any local taxing authority. For purposes of taxation th e am ount of discount a t which Treasury bills are originally sold by the United 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, redeemed 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 th e 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 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 the T reasury bills and govern the conditions of their issue. Copies of the circular may be obtained from any Federal R eserve 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 rec 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, Houston a n d San A n to n io u p to tw e l v e - th ir ty p .m ., C entr al D ay ligh t S a v in g Time, M o n d a y , J u n e 17, 1968. T e n d e rs m a y not b e e n t e r e d by t e l e p h o n e . Yours v e r y truly, P. E. Co ld w ell P re sid en 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 Septem ber 12, 1968 D ue D ecember 12, 1968 $2,628,123,000__________________ ___ ________ .T otal Applied For----------------------------------- ----------- $2,041,063,000 $ 1,600,3 72,000________________________________ T otal A ccepted------------------ -----...._-------------------- $1,100,136,000 Price Yield Price Yield 98.569 5.661% --------------------------------------H igh-------------------------------- 97.088____________ 5.760% 98.552_________ 5.728% --------------------------------------- Low_____________________ 97.067____________ 5.802% 98.556 5.713% ( 1 ) ---- ------- ----------------- Average__________________ 97.073 ___________ 5.790% (1) ( 1 ) These rates are on a bank discount basis. T he equivalent coupon issue yields are 5.88% for the 91-day bills, and 6 .05% for the 182 -day 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 Maturing December 19, 1968 Dated June 20,1968 To: Federal Reserve Bank, Station K, Dallas, Texas 75222 or — The_________________________________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 th e 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. / _ Prices should be e x pressed on the basis o f |V w 100, with not more than ( ft) COMPETITIVE TENDERS S th ree decimal p la c e s , e. g., 99.925. Fractions $ @ $ must not be used. ^ T E N D E R S MAY NOT BE ENTERED BY TELEPHONE. TENDERS BY WIRE, IF RECEIVED BEFORE T H E CLOSING HOUR, ARE ACCEPTABLE. Payment for this issue of bills cannot be m ade by credit to Treasury Tax and Loan Account. Denominations Desired Number of Pieces Maturity Value METHOD OF PAYMENT $ 1,000 $5,000 $- .© ? (5) $ 10,000 $50,000 ?- □ (a) $ 100,000 ?.(a) $ 500,000 ?. .© $1 ,000,000 ?- □ (5) $ .0 □ By m aturing bills held by___________________________ _ _ Paym ent to be made by___________ ___ Charge our reserve account on paym ent date Q Draft enclosed ( E f f e c t u a l delivery of e n c lo s e d draft ehall be on latest day which will permit p r e se n t ment in order to obtain irrevocably collected funds on paym ent date) Delivery Instructions: □ □ Pledge to secure Treasury Tax and Loan Account (Subscriber's full name or corporate title) Hold in Custody Account—Member banks for own account only □ (Address) By- Ship to----------------------------------------- (Authorized official signature and title) (For the account of, if tender is for another subscriber) (Addresa) 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 o f 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 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 th e 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 in v est ment securities will be disregarded, unless accompanied by a deposit of 2 percent of the total amount (maturity v a lu e) 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 jo material, the tender may be disregarded. (See reverse for announcement)