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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 IT E D ST A T E S DALLAS, TE X A S 75222 Circular No. 68-247 November 18, 1968 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 h e Treasury Departm ent, by this public notice, invites tenders for two series of Treasury bills to the aggregate am ount o f $1,500,000,000, or thereabouts, for cash and in exchange for Treasury bills maturing N ovem ber 30, 1968, in the am ount of $1,500,519,000, as follows: 272-D A Y B IL L S (to m aturity d ate) to be issued Decem ber 2, 1968, in the am ount o f $500,000,000, or there abouts, representing an additional am ount o f bills dated A ugust 31, 1968, and to m ature August 31, 1969, originally issued in the am ount of $1,000,387,000, the additional and original bills to be freely interchangeable. 365-D A Y B IL L S for $1,000,000,000, or thereabouts to be dated N ovem ber 30, 1968, and to mature N ovem ber 30, 1969. 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 e y will be issued in bearer form only, and in denom inations of $1,000, $5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000 (m aturity v a lu e ). Tenders w ill be received at F ederal R eserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern Standard T im e, Friday, N ovem ber 22, 1968. T enders w ill not be received at the Treasury D epartm ent, W ashington. Each tender m ust be for an even m ultiple of $1,000, and in the case of com petitive tenders the price offered m ust be expressed on the basis of 100, with not m ore than three decim als, e.g., 99.925. Fractions m ay not be used. (N otw ithstanding the fact that the oneyear bills will run for 365-days, the discount rate w ill 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 that tenders be m ade on the printed forms and forwarded in the special envelopes which w ill 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 w ill not be perm itted to subm it tenders except for their own account. Tenders w ill 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 m ade by the Treasury D epartm ent of the am ount and price range of accepted bids. T hose subm itting tenders will 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. Subject to these reservations, noncom petitive tenders for each issue for $200,000 or less w ithout stated price from any one bidder w ill 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 D ecem ber 2, 1968, in cash or other im m ediately available funds or in a like face am ount o f Treasury bills maturing N ovem ber 30, 1968. Cash and exchange tenders will receive equal treatm ent. 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. T h e incom e derived from Treasury bills, whether interest or gain from the sale or other disposition o f 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 treatment, as such, under the Internal R evenue Code of 1954. T h e 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 n ited 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 o f discount at 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 Treasury bills (other than life insurance com panies) issued hereunder need include in his incom e tax return only the difference betw een 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 m ade, as ordinary gain or loss. Treasury D epartm ent Circular N o. 41 8 (current revision) and this notice., prescribe the term s of the Treasury bills and govern the conditions of their issue. Copies o f the circular m ay be obtained from any Federal R eserve B ank or Branch. In accordance with the a bove announcement, tenders will be received at this bank and its branches at El Paso, Houston and San Antonio up to twelve-thirty p.m., Central Standard Time, Friday, November 22, 1968. Tenders may not b e entered by telephone. Yours very truly, P. E. Coldwell P r e sid e n t (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 November 30, 1969 Dated November 30, 1968 To: Federal Reserve Bank, Station K, Dallas, Texas 75222 or — The_________________________________ Branch E l P aso 79999 H ouston 77001 (D ate) San A ntonio 78206 P ursuant to the provisions of T reasury D epartm ent Circular N o. 418 (current revision ) and the provisions o f the public announcem ent issued by the T reasury D epartm ent, the undersigned offers to purchase T reasury bills in th e amount show n below , and agrees to pay for th e am ount allotted, on or before th e issu e date, by the m ethod and a t th e rate indicated. NOT TO EXCEED $200,000 NONCOMPETITIVE TENDER $. N oncom petitive tenders for $200,000 or le ss from any one bidder, w ithout stated price, w ill be accepted in fu ll at the average price (in three decim als) o f accepted com petitive bids. P rices should be e x ------------------------------pressed on th e basis o f 100, w ith n ot more than ------------------------------th r e e d e c im a l p la c e s, _____________________ e. g., 99.925. F ractions m ust n ot be used. T E N D E R S MAY NOT BE E N T E R E D BY T EL E PH O N E . T E N D E R S BY W IR E, IF REC EIVED BEFO RE THE CLOSING HOUR, A R E A CC EPTABLE. D enom inations D esired N um ber of Pieces P aym ent for th is issu e o f bills cannot be m ade by credit to T reasury Tax and Loan Account. M a tu rity V alu e (a) $ (a) ? (a) $ METHOD OF PA Y M E N T 1,000 $. □ 5,000 $. By m aturing bills held by_____________________________ Paym ent to be made by______________ 10,000 $ □ (a) $ 50,000 $. (5) $ 100,000 □ Charge our reserve account on payment date | | D r a f t e n c l o s e d ( E f f e c t u a l d e liv e r y o f e n c lo s e d d r a f t sh all be on la te st d ay w hich w ill p e rm it p re s e n t m e n t in o rd e r to o b tain irrevocably collected fu n d s on p a y m e n t date) (a> $ 500,000 (a) $1: Delivery Instructions: □ □ Pledge to secure Treasury Tax and Loan Account (S u b scrib er’s fu ll n a m e o r c o rp o ra te title ) Hold in Custody Account— Member banks for own account only □ Ship to_ (A ddress) B y_ (A uth orized official s ig n a tu re a n d title ) (F o r th e a cco u n t of, if te n d e r is f o r a n o th e r su b scrib er) (A ddress) IM PO RTANT 1. N o tender for less than $1,000 w ill be considered and each tender m u st be for an am ount in m ultiples of $1,000 (m aturity va lu e). 2. Tenders should be forw arded in an envelope clearly addressed to th is bank or appropriate branch as F iscal A gen t o f the U nited S tates, w ith n otation on th e envelope reading “T E N D E R FOR T R E A SU R Y O F F E R IN G ”. Since envelopes received w ith th is legend w ill not be opened u n til a fter the closing tim e specified in the public announcem ent, com m uni cations relatin g to other m atters should n ot be enclosed. E nvelopes for subm itting tenders m ay be obtained from th is bank or appropriate branch. 3. A ny qualified or conditional tender w ill be rejected. 4. I f a corporation m akes the tender, th e form should be signed by an officer of the corporation authorized to m ake the tender and th e sign in g of th e form by an officer o f th e corporation w ill be construed as a representation by him th a t he has been so authorized. I f the tender is m ade by a partnership it should be signed by a m em ber of th e firm, who should sign in th e form “ ................................... ............... ........ , a copartnership, b y....... ............... .............................................................. , a m em ber o f th e firm ”. 5. Tenders from th ose other than incorporated banks and tru st com panies or responsible and recognized dealers in in vest m ent securities w ill be disregarded, u nless accompanied by a deposit o f 2 percent o f the tota l am ount (m aturity va lu e) of th e T reasury bills applied for, or u nless the tenders are accom panied by an exp ress guaranty o f fu ll paym ent by an incorporated bank or tru st company. 6. I f th e lan gu a ge of th is form is changed in an y respect, w hich, in th e opinion o f the Secretary o f th e T reasury is m aterial, th e tender m ay be disregarded. (See reverse for announcement)