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federal reserve Ba nk of Dallas FISCAL AGENT OF THE UNITED STATES D ALLAS, TEXAS 7 5 2 2 2 Circular No. 72-57 March 22, 1972 To All Banking Institutions and Others Concerned in the Eleventh Federal Reserve District: The following release was given to the press by the Treasury and is provided.for your information: TREASURY ANNOUNCES FINANCING PLANS The Treasury Department announced today that it is discontinuing for the time being the additions to the weekly hills which had been initiated on February 17. A total of $1.8 billion of new cash has been raised through these additions. The Department also announced that it is offering for auction on Tuesday, March 28, $1-3/^- billion or thereabouts of a 3-year 5-7/8 percent note maturing on May 15, 1975. Payment for the notes, to be issued on April 3, 1972, may he made through Treasury Tax and Loan Accounts. The sale of the note is expected to meet cash requirements through at least mid-May, when there is a regular quarterly refunding. The reduction in the TreasuryTs cash requirements from earlier projections primarily reflects larger current revenue collections than previously anticipated. The improvement in the revenues appears related to some over withholding of personal income taxes following the change in withholding schedules required by the Revenue Act of 1971 and made effective in January. Overwithholding can he eliminated by actions by taxpayers themselves. In particular, taxpayers with only one wage earner in the family or in higher income brackets with larger than normal itemized deductions may find it desirable to adjust the number of their exemptions for withholding This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) - 2 purposes, as permitted by law, to bring the amounts withheld into close relation to their ultimate tax liability. The Treasury also noted it is reviewing the pos sibility of introducing some changes in its financing techniques to identify ways its routine debt management operations, including both its refunding and new cash raising operations, might he facilitated. Pending completion of this review, no announcement of changes are anticipated over the next month. Also enclosed is the Treasury release pertaining to the new note as well as the official offering Circular No. 1+-72 and tender form. Yours very truly, P. E. Coldwell President . Enclosures UNITED STATES OF AMERICA 5% PERCENT TREASURY NOTES OF SERIES F-1975 Due M ay 15, 1975 D a te d a n d be a rin g interest from April 3, 1972 D E P A R T M E N T OF T H E TR E A SU R Y Office of the Secretary W ashington, M arch 22, 1972 DEPARTMENT CIRCULAR PLEASE OBSERVE CLOSING TIME OF 12:30 P.M., C E N T R A L STANDARD TIME, T U E SD A Y , MARCH 28, 1972 P u b lic D e b t Series No. 4-72 I. OFFERING OF NOTES 1. T h e Secretary of the Treasury, pursuant to the authority of the Second Liberty Bond Act, as amended, invites tenders at a price not less than 99.26 percent of their face value for $1,750,000,000, or thereabouts, of notes of the U nited States, designated 5% percent T reasury N otes of Series F-1975. Tenders will be received up to 1:30 p.m., Eastern Standard Tim e, Tuesday, March 28, 1972. T he notes w ill be issued under com petitive and noncom petitive bidding, as set forth in Section III hereof. II. DESCRIPTION OF NOTES 1. T h e notes w ill be dated April 3, 1972, and will bear interest from that date at the rate of 5% percent per annum, payable on a sem i annual basis on N ovem ber 15, 1972, and thereafter on M ay 15 and N ovem ber 15 in each year until the principal amount becom es payable. T h e y will mature M ay 15, 1975, and w ill not be subject to call for redem ption prior to maturity. 2. T h e incom e derived from the notes is subject to all taxes im posed under the Internal R evenue Code of 1954. T he notes aTe 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. 3. T h e notes w ill be acceptable to secure deposits of public moneys. T h ey will not be acceptable in paym ent of taxes. 4. Bearer notes with interest coupons attached, and notes registered as to principal and interest, will be issued in denom inations of $1,000, $5,000, $10,000, $100,000 and $1,000,000. Provision will be made for the interchange of notes of different denom inations and of coupon and registered notes, and for the transfer of registered notes, under rules and regulations prescribed by the Secretary of the Treasury. 5. T h e notes will be subject to the general regulations of the D epartm ent of the Treasury, now or hereafter prescribed, governing U n ite d States notes. III. TENDERS AND ALLOTMENTS 1. T enders will be received at Federal R eserve Banks and Branches and at the Office of the Treasurer of the U nited States, W ash ington, D . C. 20220, up to the closing hour, 1:30 p.m., Eastern Standard T im e, Tuesday, M arch 28, 1972. Each tender m ust state the face am ount of notes bid for, which must be $1,000 or a m ultiple thereof, and the price offered, except that in the case of noncom p e titiv e tenders the term “noncom petitive” should be used in lieu of a price. In the case of com petitive tenders, the price must be expressed on th e basis of 100, with two decimals, e.g., 100.00. Tenders at a price less than 99.26 w ill not be accepted. Fractions m ay not be used. N on co m p etitive tenders from any one bidder m ay not exceed $200,000. It is urged that tenders be made on the printed forms and for warded in the special envelopes marked “T ender for Treasury N o tes”, which w ill be supplied by Federal R eserve Banks on application therefor. 2. Commercial banks, which for this purpose are defined as banks accepting demand deposits, m ay subm it tenders for account of custom ers provided the names of the customers are set forth in such tenders. Others than commercial banks will not be perm itted to submit tenders except for their own account. Tenders w ill be received without deposit from banking institutions for their own account, Federallyinsured savings and loan associations, States, political subdivisions or instrum entalities thereof, public pension and retirem ent and other p u b lic funds, international organizations in which the U n ited States holds membership, foreign central banks and foreign States, dealers who m ake primary markets in G overnm ent securities and report daily to the Federal Reserve Bank of N ew York their positions with respect to G overnm ent securities and borrowings thereon, and G overnm ent accounts. Tenders from others m ust be accom panied by paym ent o f 5 percent of the face am ount of notes applied for. 3. Im m ediately after the closing hour tenders w ill be opened, follow ing which public announcem ent w ill be made by the D epartm ent of th e Treasury of the am ount and price range of accepted bids. T hose subm itting tenders will be advised of the acceptance or rejection thereof. In considering the acceptance of tenders, those at the highest prices w ill be accepted to the extent required to attain the amount offered. Tenders at the lowest accepted price w ill be prorated if necessary. T he Secretary of the Treasury expressly reserves the right to accep t 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, non co m p etitive tenders for $200,000 or less w ithout stated price from an y one bidder w ill be accepted in full at the average price* (in two decim als ) of accepted com petitive tenders. 4. A ll bidders are required to agree not to purchase or to sell, or to m ake any agreem ents with respect to the purchase or sale or other disposition of any notes of this issue at a specific rate or price, until after 1:30 p.m., Eastern Standard Tim e, Tuesday, March 28, 1972. 5. Commercial banks in subm itting tenders w ill be required to certify that they have no beneficial interest in any of the tenders they enter for the account of their customers, and that their customers have no beneficial interest in the banks’ tenders for their own accou nt IV. PAYMENT 1. Settlem ent for accepted tenders in accordance w ith the bids m ust be m ade or com pleted on or before April 3, 1972, at the F ederal Reserve Bank or Branch or at the office of the Treasurer of th e U nited States, W ashington, D. C. 20220, in cash or other funds im m ed iately available by that date. P aym ent will not be deem ed to have been com pleted where registered notes are requested if the appro priate identifying number as required on tax returns and other docum ents subm itted to the Internal R evenue Service (an individual’s social security number or an em ployer identification num ber) is not furnished. In every case where full paym ent is not com pleted, the paym ent w ith th e tender up to 5 percent of the am ount of notes allotted shall, upon declaration made by the Secretary of the Treasury in his dis cretion, be forfeited to the U nited States. Any qualified depositary w ill be perm itted to make settlem ent by credit in its Treasury Tax and Loan A ccount for notes allotted to it for itself and its customers. V. GENERAL PROVISIONS 1. A s fiscal agents of the U nited States, Federal R eserve Banks are authorized and requested to receive tenders, to make such allotm ents as m ay be prescribed by the Secretary of the Treasury, to issue such notices as m ay be necessary, to receive paym ent for and m ake delivery of notes on full-paid tenders allotted, and they m ay issue interim receipts pending delivery of the definitive notes. 2. T h e Secretary of the Treasury m ay at any tim e, or from tim e to tim e, prescribe supplem ental or am endatory rules and regulations governing the offering, which will be com m unicated prom ptly to the Federal R eserve Banks. JO H N B. CO NNALLY, Secretary of the Treasury. •A verage price may be at, or more or less than 100.00. (S e e reverse for tender form ) TENDER 5%% TREASURY NOTES OF SERIES F-1975 Maturing May 15,1975 Dated April 3,1972 To: Federal Reserve Bank, Station K, Dallas, Texas 75222 or — The________________________ Branch El Paso 79999 Houston 77001 San Antonio 78295 (Data) Please Observe Closing Time of 12:30 P.M., Central Standard Time, Tuesday, March 28,1972 Pursuant to the provision of Treasury Department Circular, Public Dept Series No. 4-72, as shown on the reverse side, the undersigned offers to purchase Treasury notes in the amount shown below, and agrees to pay for the amount allotted, on or before the issue date, by the method and a t the rate indicated. NONCOMPETITIVE TENDER $______________________________________ NOT TO EXCEED $200,000 Noncompetitive tenders for $200,000 or less from any one bidder, without stated price, will be accepted in full at the average price (in two decimals) of accepted competitive bids. Prices snoula De ex pressed on the basis of 100, with two decimals, e. g., 100.00. Fractions (ft) .......nr.$ ■.. lm COMPETITIVE TENDERS $ must not be nsed. Tend ers at a price less than $ ..... . @ % 99.26 will not be ac cepted. METHOD OF PAYMENT Denominations Desired Number of Pieces By charge to our Treasury Tax and Loan Account Payment to be made by................................................. 10,000 □ By charge to our reserve account on payment date. $ 100,000 $_. □ By d raft enclosed (effectual delivery of enclosed d ra ft shall be on latest day which will permit presentment in order to obtain irrevocably collected funds on paym ent date). 1,000 $.. @$ @$ 5,000 $_ @ - □ □ M aturity Value $ @ (Name of Bank) $ 1,000,000 $- _ @ SCHEDULE FOR ISSUE OF REGISTERED SECURITIES Name or names in which securities are to be registered, tax account number of owner and mailing address for interest checks. Denominations Desired Denomination .... . . _ _ or Social Security No. 0 ( @ Employer Identification No. F a rft Amount ?........................... ? . ? A m o u n t ....................... $ ,, CERTIFICATION BY COMMERCIAL BANKS We hereby certify that we have received tenders from our customers in the amounts set opposite the customers’ names on the list which is made a part of this tender; that there has been paid to us by each such customer as required by the official offering circular, not subject to withdrawal until after allotment, not less than 5 percent of the amount bid for; that we have not made unsecured loans, or loans collateralized in whole or in part by the notes hid for, to supply the amounts of such payments to any of such customers; that we have no beneficial interest in the tenders of such customers; and that none of our customers has any beneficial interest in the amount bid for our own account. We further certify that tenders received by us, if any, from other commercial hanks for their own account and for the account of their customers have been entered with us under the same conditions, agreements and certifications as set forth in this form. CERTIFICATION BY ALL SUBSCRIBERS We certify that all subscribers listed hereon have agreed not to purchase or to sell, or to make any agreements with respect to the purchase or sale or other disposition of any of the notes of this issue at a specific rate or price, until after 1:30 p.m., Eastern Standard Time, Tuesday, March 28, 1972. Delivery Instructions: □ Hold in Custody Account—Member banks for own account only □ Pledge to secure Treasury Tax and Loan Account □ Ship to.. (Sobeoriber’t full name or corporate title) (Address) By- (Authorised official signature and title) (For the account of, if tender is for another subscriber)