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federal Re ser v e bank of Dallas FISCAL AGENT O F TH E UNITED STATES DALLAS, TEXAS 7 5 2 2 2 Circular No. 7^-211 July 31, 197^ To All Banking Institutions and Others Concerned in the Eleventh Federal Reserve District: Quoted below is the text of a statement issued by the Treasury Department today concerning the August refinancing. TREASURY FINANCING The Treasury will auction to the public next week up to $2.25 billion of 33-month notes, up to $1.75 billion of 6-year notes, and up to $*+00 million of 8-1/2°fo 2*+ 3/k year bonds. The rates for the notes will be announced on Friday, August 2. Additional amounts of the notes and bonds will be allotted to Goverment accounts and the Federal Reserve Banks in exchange for their holdings of the maturing notes, which total $5.9 billion. The Treasury will also increase the amount of bills to be auctioned on August 5 and issued on August 8 by $200 million. This is an amendment of the announcement of July 30. These Treasury issues will provide funds for refunding the $U.3 billion of notes held by the public maturing on August 15 and a portion of the funds needed to cover the Treasury’s additional needs estimated to be approximately $3.5 billion by the early part of September. It is anticipated that additional funds will be raised by additions to the regular weekly bill auctions and by issues of other Treasury obliga tions having a maturity of one year or less to meet the balance of September needs. To the extent that additional special securities are issued by the Treasury to foreign authorities, during the coming weeks, the need for these short-term issues will be reduced. The notes and bonds to be auctioned will be: Treasury Notes of Series D-1977 dated August 15, 197*+, due May 15, 1977 (CUSIP No. 912827 DVl) with interest payable on November 15, 197^, and thereafter on May 15 and November 15, This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) -2- Treasury Notes of Series B-I98O dated August 15, 197b, due August 15, 1980 (CUSIP No. 912827 DW9) with interest payable on February 15 and August 15, and an additional amount of 8-1/2$ Treasury Bonds of 199^-99 dated May 15, 197^-, due May 15, 1999, call able at the option of the United States on any interest payment date on and after May 15, 199^+ (CUSIP No. 912810 BR8) with interest payable on May 15 and November 15. The notes and bonds will be issued in registered and bearer form in denominations of $1,000, $ 5,000, $10,000, $100,000 and $1 , 000, 000. Tenders for the 33-month notes will be received up to 1:30 p.m., Eastern Daylight Saving time, Tuesday, August 6 , tenders for the 6year notes will be received up to 1:30 p.m., Eastern Daylight Saving time, Wednesday, August 7, and tenders for the bonds will be received up to 1:30 p.m., Eastern Daylight Saving time, Thursday, August 8, at any Federal Reserve Bank or Branch and at the Bureau of the Public Debt, Washington, D. C. 20226; provided, however, that non-competitive tenders will be considered timely received if they are mailed to any such agency under a postmark no later than August 5 for the 33-month notes, August 6 for the 6-year notes, and August 7 for the bonds. Each tender must be in the amount of $1,000 or a multiple thereof, and all tenders must state the price offered, if a competitive tender, or the term "noncompetitive", if a noncompetitive tender. The price on competitive tenders for the notes and bonds must be expressed on the basis of 100, with two decimals, e.g., 100.00. Tenders at a price less than 99*51 for the 33-month notes, 98.51 for the 6-year notes, and 9^*01 for the bonds will not be accepted. Tenders at the highest prices will be accepted to the extent required to attain the amount offered. Successful competitive bidders will be required to pay for the securities at the price they bid. Noncompetitive bidders will be required to pay the average price of all accepted competitive tenders. Fractions may not be used in tenders. The notation "TENDER FOR TREASURY NOTES (Series D-1977 or B-I980)" or "TENDER FOR TREASURY BONDS" should be printed at the bottom of the envelopes in which the tenders are submitted. 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 $ 500,000 or less for each issue will be accepted in full at the average price of accepted competitive tenders. -3- The prices may be 100.00, or more or less than 100.00. Commercial banks, which for this purpose are defined as banks accepting demand deposits, and 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, may submit tenders for the account of customers provided the names of the customers are set forth in such tenders. Others 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 member ship, 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, Federal Reserve Banks, and Government accounts. Tenders from others must be accompanied by payment of 5 percent of the face amount of securities applied for. Payment for accepted tenders must be completed on or before Thursday, August 15, 197^-. Payments for the bonds must include interest from May 15 to August 15, 197^-, in the amount of $21.25 per $1,000 of bonds allotted. Payments must be made at the Federal Reserve Bank or Branch or at the Bureau of the Public Debt in cash, 5-5/8$ Treasury Notes of Series B-197*+, which will be accepted at par, or other funds immediately available to the Treasury by that date. 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 securities allotted will be subject to forfeiture to the United States. The Treasury will construe as timely payment any check drawn to the order of the Federal Reserve Bank or the United States Treasury that is received at such bank or at the Treasury by Tuesday, August 13, 197*+, 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. Checks not so collected will subject the investor’s deposit to forfeiture as set forth in the preceding para graph. 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 securities 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 or to make any agreements with respect to the purchase or or other disposition of the securities bid for under this at a specific rate or price, until after the closing hour receipt of tenders for each particular issue. to sell, sale offering for the Combination tender forms/circular letters will be distributed tomorrow. Yours very truly, P. E. Coldwell President
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