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federal Reserve Ba n k of Da lla s F IS C A L A G E N T O F T H E U NIT E D S T A T E S D A L L A S .T E X A S 7 5 2 2 2 Circular No. 72-229 October 5, 1972 To All Banking Institutions and Others Concerned in the Eleventh Federal Reserve District: There is quoted below the text of a press statement issued by the Treasury Department today: TREASURY ANNOUNCES NOTE AUCTION The Treasury today announced the sale at auction of $2.0 billion of G°J0 notes which will mature on Septem ber 30, 197k. The auction will be held on Wednesday, October 11. The payment date of the notes will be Thursday, October 19; commercial banks may make payment for their own and their customer’s accepted tenders by credit to Treasury Tax and Loan Accounts. The Treasury contemplates issuing 2-year notes maturing at quarterly intervals as a part of its program for raising cash this fiscal year. A further issue of this type is planned for next December or early January. Details of the note auction are enclosed. Tender forms and official circulars will be mailed on Friday, October 6 . Additional copies will be fur nished upon request. Yours very truly, P. E. Coldwell President Enclosure This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) DETAILS OF TREASURY AUCTION OF $2.0 BILLION OF NOTES The $2.0 billion, or thereabouts, of 2-year Treasury Notes to be sold at auction under competitive and noncompetitive bidding will be 6$> Treasury Notes of Series E-197^-, dated October 19, 1972, due September 30, 197*+ (CUSIP No. 912827 CU^). The notes will be issued in registered and bearer form in denomina tions of $1,000, $5,000, $10,000, $100,000 and $1,000,000. Interest will be payable on March 31 and September 30 until maturity. Tenders for the notes will be received up to 1:30 p.m., Eastern Daylight Saving Time, Wednesday, October 11, 1972, at any Federal Reserve Bank or Branch and at the Office of the Treasurer of the United States, Securities Division, Washington, D. C. 20220; provided, however, that noncompetitive tenders will be considered timely received if they are mailed to any such agency under a postmark no later than Tuesday, October 10. Each tender must be in the amount of $1,000 or a multiple thereof, and must state the price offered, if it is a competitive tender, or the term "noncompetitive", if it is a noncompetitive tender. The price on competitive tenders must be expressed on the basis of 100, with two decimals, e.g., 100.00. Tenders at a price less than 99*76 will not be accepted. Fractions may not be used. The notation "TENDER FOR TREASURY NOTES" should be printed at the bottom of the envelope in which the tender is submitted. Public announcement will be made of the amount and price range of accepted tenders. Those submitting tenders will be advised of the acceptance or rejection thereof. The 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 noncompetitive tenders for $200,000 or less will be accepted in full at the average price (in two decimals) of accepted competitive tenders. This price may be 100.00, or more or less than 100.00. Commercial banks, which for this purpose are defined as banks accepting demand deposits, may submit tenders for account of customers provided the names of the customers are set forth in such tenders. Others than commercial banks will not be permitted to submit tenders except for their own account. Tenders will be received without deposit from commercial and other banks for their own account, Federally-insured savings and loan associations, States, political subdivisions or instrumentalities thereof, public pension and retirement and other public funds, international organizations in which the United States holds membership, foreign central banks and foreign States, dealers who make primary markets in Government securities and report daily to the Federal Reserve Bank of New York their positions with respect to Government securities and borrowings thereon, and Government accounts. Tenders from others must be accompanied by payment of 5 percent of the face amount of notes applied for. Payment for accepted tenders must be completed on or before Thursday, October 19, 1972, at the Federal Reserve Bank or Branch or at the Office of the Treasurer of the United States in cash or other funds immediately available to the Treasury by that date. Any qualified depositary will be permitted to make settlement by credit in its Treasury tax and loan account for the amount of the notes allotted to it for itself and its customers. Where full payment is not completed in funds available by the payment date, the allotment will be canceled and the deposit with the tender up to 5 percent of the amount of notes allotted will be subject to forfeiture to the United States. The Treasury will construe as timely payment any check payable to the Federal Reserve Bank or the Treasurer of the United States that is received at such bank or office by Monday, October l6 , 1972, provided the check is drawn on a bank in the Federal Reserve District of the bank or office to which the tender is submitted. Other checks will constitute payment only if they are fully and finally collected by the payment date Thursday, October 19? 1972. Checks not so collected will subject the investor’s deposit to forfeiture as set forth in the preceding paragraph. A check payable other than at a Federal Reserve Bank received on the payment date will not constitute immediately available funds on that date. Commercial banks are prohibited from making unsecured loans, or loans collateralized in whole or in part by the notes bid for, to cover the deposits required to be paid when tenders are entered, and they will be required to make the usual certification to that effect. Other lenders are requested to refrain from making such loans. All bidders are required to agree not to purchase or to sell, or to make any agreements with respect to the purchase or sale or other disposition of the notes bid for under this offering at a specific rate or price, until after 1:30 p.m., Eastern Daylight Saving time, Wednesday, October 11, 1972. UNITED STATES OF AMERICA 6 PERCENT TREASURY NOTES OF SERIES E-1974 PLEASE OBSERVE CLOSING TIME OF 12:30 P.M., CENTRAL DAYLIGHT SAVING TIME, WEDNESDAY, OCTOBER 11, 1972 D a te d a n d b e a r i n g in te r e st from O c to b e r 19, 1 9 7 2 D ue S e p t e m b e r 3 0 , 1 9 7 4 T H E D EPA R TM EN T OF T H E TREA SURY Office of th e S e c retary W ashin g to n , O ctob er 6 , 1972 DEPARTMENT CIRCULAR P u b lic D e b t S eries No. 10-72 I. OFFERING NOTES 1. T h e S e c retary of th e T rea su ry , p u rs u a n t to th e a u th o rity of th e Sgcond L ib e rty B o nd A ct, as am en ded , in v ite s te n d e rs a t a price n o t less th a n 99.76 p e rc e n t o f th e ir face v alue for $2,000,000,000, or th ere ab o u ts, of notes of th e U n ite d S tates, d esig n ated 6 p e rc e n t T re a su ry N o tes of S eries E -1974. T e n d e rs will b e received u p to 1 :3 0 p.m ., E a s te rn D a y lig h t S avin g tim e, W edn esd ay , O cto ber 11, 1972. T h e n o tes will be issued u n d e r c o m p e titiv e a n d n o n c o m p e titiv e bidding, as set fo rth in S ectio n I I I hereof. II. DESCRIPTION OF NOTES 1 . T h e notes will be d a te d O cto ber 19, 1972, a n d w ill b e a r in te re st fro m th a t d a te a t th e r a te of 6 p e rc e n t p e r a n n u m , p a y ab le on a sem ian n u al basis on M a rc h 31 a n d S e p te m b e r 30, 1973, a n d M a rc h 31 a n d S e p te m b e r 30, 1974. T h e y w ill m a tu re S e p te m b e r 30, 1974, a n d w ill n o t be su b je ct to call fo r re d e m p tio n p rio r to m a tu rity . 2. T h e incom e d eriv ed from th e notes is su b je ct to a ll tax es im p o sed u n d e r th e In te rn a l R e v e n u e C ode o f 1954. T h e n o tes a re su b je ct to e state, in h eritan c e, g ift o r o th e r excise taxes, w h e th e r F e d e ra l o r S ta te , b u t a re e x em p t fro m a ll tax a tio n now o r h e re a fte r im posed on th e p rin c ip a l o r in te re st th ere o f b y a n y S ta te , o r a n y of th e possessions of th e U n ite d S tates, or b y a n y local tax in g au th o rity . 3. T h e n otes w ill be a cc ep ta b le to secure d ep osits of p u b lic m oneys. T h e y will n o t b e a cc ep ta b le in p a y m e n t of taxes. 4. B e a re r notes w ith in te re st coupons a tta ch e d , a n d notes re g iste red as to p rin c ip a l a n d in terest, w ill be issued in d e n o m in a tio n s of $1,000, $5,000, $10,000, $100,000 a n d $1,000,000. P ro v isio n w ill b e m ad e for th e in te rc h an g e of n otes of d ifferen t d en o m in atio n s an d of coupon a n d reg istered notes, a n d for th e tra n s fe r of re g iste red notes, u n d e r ru les a n d reg u latio n s p re sc rib e d b y th e S e c retary o f th e T rea su ry . 5. T h e n o tes w ill be su b je ct to th e general reg u latio n s of T h e D e p a rtm e n t of th e T re a su ry , now o r h e re a fte r p rescrib ed , governing U n ite d S ta te s notes. III. TENDERS AND ALLOTMENTS 1 . T e n d e rs will b e re ce iv e d a t F e d e ra l R e se rv e B a n k s a n d B ra n ch e s a n d a t th e Office of th e T re a su re r of th e U n ite d S tates, W ashin g ton, D . C. 20220, u p to th e closing hour, 1 :3 0 p.m ., E a s te rn D a y lig h t S av in g tim e, W ednesday, O cto b er 11, 1972. E a c h te n d e r m u st s ta te th e face a m o u n t of n o tes b id for, w hich m u st b e $ 1,000 or a m u ltip le th ereof, a n d th e p rice offered, ex cep t t h a t in th e case of non c o m p e titiv e te n d e rs th e te rm “n o n c o m p e titiv e ” should be used in lieu of a price. In th e case of c o m p e titiv e tend ers, th e p rice m u st be expressed on th e basis of 100, w ith tw o decim als, e.g., 100.00. T e n d e rs a t a p rice less th a n 99.76 will n o t b e accep ted . F ra c tio n s m a y n o t be used. N o n c o m p etitiv e te n d e rs from a n y one b id d e r m a y n o t ex ceed $200,000. I t is u rg e d t h a t te n d e rs be m ad e on th e p rin te d form s an d fo rw arded in th e special en velo p es m a rk e d “T E N D E R F O R T R E A S U R Y N O T E S ”, w hich will be su p p lied b y F e d e ra l R e se rv e B a n k s on a p p lic a tio n th erefo r. 2. C om m ercial banks, w hich for th is p u rp o se a re defined as b a n k s accep tin g d e m a n d deposits, m a y su b m it te n d e rs fo r acco u n t of custom ers p ro v id ed th e n am es of th e custom ers a re se t fo rth in such ten d ers. O th ers th a n com m ercial b a n k s will n o t b e p e rm itte d to su b m it te n d e rs ex cep t for th e ir own account. T e n d e rs will b e receiv ed w ith o u t d ep o sit fro m b a n k in g in stitu tio n s fo r th e ir own account, F e d e rally -in su red savings a n d lo an associations, S tates, po litical subdivisions o r in stru m e n ta litie s th ereof, p u b lic p en sio n a n d re tire m e n t a n d o th e r p u b lic funds, in te rn a tio n a l o rgan izatio ns in w hich th e U n ite d S ta te s holds m em b e rsh ip , fo reign c e n tra l b an k s a n d foreign States, dealers w ho m ak e p rim a ry m a rk e ts in G o v e rn m en t securities a n d re p o rt d aily to th e F e d e ra l R e se rv e B a n k of N ew Y o rk th e ir po sitio n s w ith re sp e ct to G o v e rn m e n t securities a n d borrow ings th ereo n , a n d G o v e rn m en t accounts. T e n d e rs fro m o th ers m u st be acco m p an ied b y p a y m e n t of 5 p e rc e n t of th e face a m o u n t o f n otes a p p lie d for. 3. Im m e d ia te ly a f te r th e closing h o u r te n d e rs w ill b e opened, follow ing w hich p u b lic a n n o u n ce m en t will b e m ad e b y T h e D e p a rt m e n t of th e T re a su ry of th e a m o u n t a n d p rice ra n g e of a cc ep te d bids. T h o se su b m ittin g te n d e rs will be adv ised of th e a cc ep ta n ce or re je ctio n thereo f. In considering th e acc ep ta n ce of ten d ers, th o se a t th e h ig h est p rices w ill be acc ep te d to th e e x te n t re q u ire d to a tta in th e a m o u n t offered. T e n d e rs a t th e low est a cc ep te d p rice w ill b e p ro ra te d if necessary. T h e S e c retary o f th e T re a su ry expressly reserv es th e rig h t to a c c e p t o r re je c t a n y o r all ten d ers, in w hole o r in p a rt, a n d his actio n in a n y such re sp e ct shall be final. S u b je c t to th ese reserv atio n s, n o n c o m p e titiv e te n d e rs for $ 2 0 0 ,0 0 0 o r less w ith o u t sta te d p rice from a n y one b id d e r will b e acc ep te d in full a t th e av erag e p rice 1 ( in tw o d ecim als) of a cc ep te d c o m p e titiv e tenders. 4. A ll b id d ers a re re q u ire d to agree n o t to p u rch ase o r to sell, o r to m ak e a n y a g ree m e n ts w ith re sp e ct to th e p u rc h ase o r sale or o th e r d isp o sitio n of a n y no tes of th is issue a t a specific r a te or p rice, u n til a f te r 1 :3 0 p.m ., E a s te rn D a y lig h t S avin g tim e, W ednesday, O cto b er 11, 1972. 5. C om m ercial b a n k s in su b m ittin g te n d e rs will be re q u ire d to c e rtify t h a t th e y hav e no beneficial in te re st in a n y of th e te n d e rs th e y e n te r for th e a cc o u n t of th e ir custom ers, a n d t h a t th e ir cu stom ers h a v e no beneficial in te re st in th e b a n k s’ te n d e rs fo r th e ir own account. IV. PAYMENT 1 . S e ttle m e n t fo r a cc ep te d te n d e rs in accordance w ith th e b id s m u st b e m ad e or c o m p le te d on or befo re O cto b er 19, 1972, a t th e F e d e ra l R e se rv e B a n k or B ra n ch o r a t th e Office of th e T re a su re r of th e U n ite d S tates, W ashin g to n , D . C. 20220, in cash or o th er fu nd s im m e d ia tely a v ailab le b y t h a t date. P a y m e n t will n o t be d eem ed to h a v e b een c o m p le te d w here re g iste red n o tes a re re q u este d if th e a p p ro p ria te id en tify in g n u m b e r as re q u ire d on ta x re tu rn s a n d o th e r do cum ents su b m itte d to th e In te rn a l R e v e n u e Service (a n in d iv id u a l’s social se c u rity n u m b e r or a n em p lo y er id entificatio n n u m b e r) is n o t furn ished . In e v ery case w h ere full p a y m e n t is n ot co m pleted , th e p a y m e n t w ith th e te n d e r u p to 5 p e rc e n t o f th e a m o u n t of n o tes a llo tte d shall, u p o n d e cla ra tio n m ad e b y th e S ecretary of th e T re a su ry in his discretion, b e fo rfeited to th e U n ite d States. A ny qualified d e o p sita ry will be p e rm itte d to m ak e s e ttle m e n t b y c re d it in its T re a s u ry T a x a n d L o an A ccou n t fo r n o tes a llo tte d to i t fo r itself a n d its custom ers. V. GENERAL PROVISIONS 1 . As fiscal a gen ts of th e U n ite d S tates, F e d e ra l R e se rv e B a n k s a re au th o riz ed a n d re q u este d to receiv e ten d e rs, to m ak e such allo tm e n ts as m a y be p re sc rib e d b y th e S e c retary of th e T rea su ry , to issue such n otices as m a y be necessary, to receive p a y m e n t for an d m ak e de liv e ry of n o tes on fu ll-p aid te n d e rs a llo tte d , a n d th e y m a y issue in te rim re ce ip ts p e n d in g de liv e ry o f th e definitive notes. 2. T h e S e c retary of th e T re a s u ry m ay a t a n y tim e, o r fro m tim e to tim e, p rescrib e su p p le m e n tal or a m e n d a to ry ru les a n d re g u lation s g ov erning th e offering, w hich will b e c o m m u n ica ted p ro m p tly to th e F e d e ra l R e se rv e B anks. /> E D W I N S. C O H E N , A cting S e c retary o f th e T rea su ry . 1A verage price m ay be a t, o r m ore o r less th a n 100.00. (S ee reverse for ten d er form ) TENDER 6% TREASURY NOTES OF SERIES E-1974 Dated October 19,1972 Maturing September 30, 1974 To: Federal Reserve Bank, Station K, Dallas, Texas 75222 or — The________________________ Branch El Paso 79999 H ouston 77001 San Antonio 78295 Please Observe Closing Time of 12:30 P.M., Central Daylight Saving Time, Wednesday, October 11, 1972 (D ate) P u rsu a n t to the provision of T reasury D epartm ent Circular, Public Debt Series No. 10-72, as shown on the reverse side, the undersigned offers to purchase Treasux’y notes in the am ount shown below, and agrees to pay fo r th e am ount alloted, on or before the issue date, by the m ethod 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 should be ex -----------------------@ ------------ $----------------------------- _______ pressed on the basis of 100, with two decimals, COMPETITIVE TENDERS _______________ @ ________ ___________________________ e. g., 100.00. F ractions m u st not be used. Tend -----------------------@ ------------ $ ----------------------------- ______ ers a t a price less th an ' 99.76 will not be ac cepted. h Denominations Desired N u m b er o f Pieces ------------------------------- METHOD OF PAYM ENT M a tu rity V alu e <g> $ — $ . $ 1,000 5,000 $. 10,000 $. By charge to our T reasury T ax and Loan Account □ Paym ent to be m ade by.................................................. .. □ By charge to our reserve account on paym ent date. □ By d ra ft enclosed (effectual delivery of enclosed d ra ft shall be on la test day which will perm it presentm ent in order to obtain irrevocably collected funds on paym ent d ate). (N am e of Bank) <§> $ 100,000 $. @ $1 ,000,000 -------------------------------— □ SCHEDULE FOR ISSUE OF REGISTERED SECURITIES N am e or nam es in which securities are to be registered, ta x account num ber of owner and m ailing address fo r interest checks. Denominations Desired Pieces - - 1 - Social S e c u rity N o. 1- 11 1 E m ployer Id en tificatio n No. D eno m ination A m ount (a) $ $ (n) 8 <R Far^R A m o u n t .........$ CERTIFIC ATIO N BY COMMERCIAL BANKS We hereby certify th a t we have received tenders from our customers in the am ounts set opposite the custom ers’ nam es on the list which is made a p a rt of this tender; th a t there has been paid to us by each such customer as required by the official offering circular, not subject to w ithdraw al until a fte r allotment, not less than 5 percent of the am ount bid for; th a t we have not made unsecured loans, or loans collateralized in whole or in p a rt by the notes bid for, to supply the am ounts of such paym ents to any of such custom ers; th a t we have no beneficial interest in the tenders of such custom ers; and th a t none of our customers has any beneficial interest in the am ount bid for our own account. W e fu rth e r certify th a t tenders received by us, if any, from other commercial banks for their own account and for the account of their custom ers have been entered with us under the same conditions, agreem ents and certifications as set fo rth in this form. CER TIFIC ATIO N BY ALL SUBSCRIBERS We certify th a t all subscribers listed hereon have agreed not to purchase or to sell, or to make any agreem ents 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 a fte r 1:30 p.m., E astern D aylight Saving Time, Wednesday, October 11, 1972. Delivery Instructions: ( S u bscriber’s fu ll nam e o r c o rp o ra te title ) □ □ □ Hold in Custody Account—Member banks for own account only Pledge to secure Treasury Tax and Loan Account Ship to- (A ddress) By____________________________________ (A uthorized official sig n a tu re an d title) (F o r th e acco u n t of, if ten d er is fo r a n o th e r su bscriber) (Address) (See reverse for announcement)