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F E D E R A L R E S E R V E BA N K O F NEW YO RK Fiscal Agent of the United States J Circular No. 5 9 20~l " L December 20, 1966 J O F F E R IN G OF T W O SER IES OF T R E A S U R Y B ILL S $ 5 0 0 ,0 0 0 ,0 0 0 of 270-D ay Bills, Additional A m ount, Series Dated September 3 0 ,1 9 6 6 , Due September 3 0 ,1 9 6 7 (T o Be Issued January 3 , 1 9 6 7 ) $ 9 0 0 ,0 0 0 ,0 0 0 of 365-D ay Bills, Dated December 3 1 , 1 96 6, Due December 3 1, 1967 T o A l l Incorporated B anks and T ru st Companies, and O thers Concerned, in the Second Federal R eserve D istrict: Following’ is the text of a notice issued by the Treasury Department, released for publication today at 4 p.m., Eastern Standard time: The Treasury Department, by this public notice, invites tenders for two series of Treasury bills to the aggregate amount of $1,400,000,000, or thereabouts, for cash and in exchange for Treasury bills maturing December 31, 1966, in the amount of $1,001,028,000, as follows: 270-day bills (to maturity date) to be issued January 3, 1967, in the amount of $500,000,000, or thereabouts, representing an additional amount of bills dated Sep tember 30, 1966, and to mature September 30, 1967, originally issued in the amount of $900,113,000, the addi tional and original bills to be freely interchangeable. 365-day bills, for $900,000,000, or thereabouts, to be dated December 31, 1966, and to mature December 31, 1967. The bills of both series will be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided, and at maturity their face amount will be payable without interest. They 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 (maturity value). Tenders will be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern Standard time, Tuesday, December 27, 1966. Tenders will not be received at the Treasury Department, Washington. Each tender must be for an even multiple of $1,000, and in the case of competitive tenders the price offered must be expressed on the basis of 100, with not more than three decimals, e.g., 99.925. Fractions may not be used. (Notwithstanding the fact that the one-year bills will run for 365 days, the discount rate will be computed 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 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 may submit tenders for account of customers, provided the names of the customers are set forth in such tenders. Others than banking institutions will not be permitted to submit tenders except for their own account. Tenders will be received without deposit from incorporated banks and trust companies and from responsible and recognized dealers in investment securities. Tenders from others must be accompanied by payment of 2 percent of the face amount of Treasury bills applied for, unless the tenders are accompanied by an express guaranty of payment by an incorporated bank or trust company. Immediately after the closing hour, tenders will be opened at the Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price range of accepted bids. Those sub mitting 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 each issue for $200,000 or less without 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. Settlement for accepted tenders in accordance with the bids must be made or completed at the Federal Reserve Bank on January 3, 1967, in cash or other immediately available funds or in a like face amount of Treasury bills maturing December 31, 1966. Cash and exchange tenders will receive equal treatment. Cash adjust ments will be made for differences between the par value of maturing bills accepted in exchange and the issue price of the new bills. The income derived from Treasury bills, whether interest or gain from the 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 treat ment, as such, under the Internal Revenue Code of 1954. The bills are subject to estate, inheritance, gift or other excise taxes, whether Federal or State, but are exempt from all taxa tion 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 the amount of discount at which Treasury bills are originally sold by the United States is considered to be interest. Under Sections 454(b) and 1221(5) of the Internal Revenue Code of 1954, the amount of discount at which bills issued hereunder are sold is not considered 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 com panies) issued hereunder need include in his income tax return only the difference between the price paid for such bills, whether on original issue or on subsequent purchase, and the amount actually received either upon sale or redemption at maturity during the taxable year for which the return is made, as ordinary gain or loss. Treasury Department Circular N o. 418 (current revision) and this notice prescribe the terms of the Treasury bills and govern the conditions of their issue. Copies of the circular may be obtained from any Federal Reserve Bank or Branch. This Bank will receive tenders for both series up to 1 :30 p.m., Eastern Standard time, Tuesday, December 27, 1966, at the Securities Department of its Head Office and at its Buffalo Branch. Tender forms for the respective series are enclosed. Please use the appropriate forms to submit tenders and return them in the enclosed yellow envelope marked “ Tender for Special Treasury Bills.” Tenders may be submitted by telegraph, subject to written confirmation; they may not be submitted by telephone. Payment for the Treasury bills cannot be made by credit through the Treasury Tax and Loan Account. Settlement must be made in cash or other immediately available junds or in maturing Treasury bills. A lfred H ayes, President. No....................................... T E N D E R F O R SP E C IA L 2 7 0 -D A Y T R E A S U R Y B ILL S Additional Amount, Series Dated September 30, 1 9 6 6 , Due September 3 0, 1967 (T o Be Issued January 3, 1 9 6 7 ) To F ed era l R eserve B an k o f N ew Dated a t .............................................................. Y ork , .............................................................. t 19____ Fiscal Agent of the United States. Pursuant to the provisions of Treasury Department Circular No. 418 (current revision) and to the provisions of the public notice issued by the Treasury Department inviting tenders for the above-described Treasury bills, the undersigned hereby offers to purchase the above-described Treasury bills in the amount indicated below, and agrees to make payment therefor at your Bank on or before the settlement date specified in the public notice at the price indicated below: C O M P E T IT IV E T E N D E R ^ C O M P E T I T I V E TENDEI. [ $ ....................................... .........................(maturity value), or any lesser amount that may be awarded. Price: ....................................... per 100. (P r ic e m ust be expressed w ith not more than three decim al places, fo r exam ple, 99.925) $ ................................................................ (maturity value). (N o t to exceed $200,000 fo r one bidder through a ll sources) A t the average price of accepted competitive bids. Subject to allotment, please issue, deliver, and accept payment for the bills as indicated below: Pieces Denomination $ Maturity value 1,000 □ 5,000 □ □ 10,000 □ 50,000 □ 1. Deliver over the counter to the undersigned 2. Ship to the undersigned 3. Hold in safekeeping (for account o f member hank only)* 4. Allotment transfer (see list attached) 5. Special instructions: Payment will be made as follows: □ By charge to our reserve account □ By cash or check in immediately available funds □ By surrender of $ ............................... (maturity value) of' maturing Treasury bills. Pay cash adjust ment, if any— 100,000 □ □ 500,000 1, 000,000 By credit to our reserve account ( Paym ent cannot be made through Treasury T a x and L o a n A cco u n t) (N o changes in delivery instructions w ill be accepted) Total By check * If this item is checked, the undersigned certifies that the allotted bills will be owned solely by the undersigned. Name of su bscriber.......................................................................................................................................... Insert this tender in yelloiv envelope marked “ Tender for Special Treasury Bills” (Please print) B y ............................................... By (O fficial signature(s) required) Title ........................................... ..................... T i t l e ............ Address (Banks submitting tenders for customer account must indicate names below, or attach a list) (N am e o f custom er) (Name of customer) IN S T R U C T IO N S : 1. N o tender for less than $1,000 will be considered, and each tender must be for an even multiple of $1,000 (maturity value). 2. Others than banking institutions will not be permitted to submit tenders except for their own account. Banks submitting tenders for customer account may consolidate competitive tenders at the same price and may consolidate non competitive tenders, provided a list is attached showing the name of each bidder, the amount bid for his account, and method of payment. Forms for this purpose will be furnished on request. 3. I f the person making the tender is a corporation, the tender should be signed by an officer of the corporation authorized to make the tender, and the signing of the tender 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.” 4. Tenders will be received without deposit from incorporated banks and trust companies and from responsible and recognized dealers in investment securities. Tenders from others must be accompanied by payment of 2 percent of the face amount of Treasury bills applied for, unless the tenders are accompanied by an express guaranty of payment by an incorporated bank or trust company. 5. If the language of this tender is changed in any respect, which, in the opinion of the Secretary of the Treasury, is material, the tender may be disregarded. No............... T E N D E R F O R SP E C IA L 3 6 5 -D A Y T R E A S U R Y B ILLS Dated December 3 1 , 196 6 To F ed era l R eserve B an k o f N ew Due December 3 1, 1967 Dated a t .............................................................. Y ork , Fiscal Agent of the United States. .............................................................. , 1 9 . . . . Pursuant to the provisions of Treasury Department Circular No. 418 (current revision) and to the provisions of the public notice issued by the Treasury Department inviting tenders for the above-described Treasury bills, the undersigned hereby offers to purchase the above-described Treasury bills in the amount indicated below, and agrees to make payment therefor at your Bank on or before the settlement date specified in the public notice at the price indicated below: C O M P E T IT IV E T E N D E R [ ] $ ....................................... .........................(maturity value), or any lesser amount that may be awarded. P r ic e :....................................... per 100. (P ric e must be expressed w ith not more than three decimal places, fo r exam ple, 99.925) N O N C O M P E T IT IV E T E N D E R $ ................................................................ (maturity value). (N o t to excecd $200,000 fo r one bidder through all sources) A t the average price of accepted competitive bids. Subject to allotment, please issue, deliver, and accept payment for the bills as indicated below: Pieces Denomination $ Maturity value 1,000 1. Deliver over the counter to the undersigned 2. Ship to the undersigned 3. Hold in safekeeping (for ac count of member bank only)* 4. Allotment transfer (see list attached) 5. Special instructions: □ □ □ 5,000 □ 10,000 □ 50,000 Payment will be made as follows: □ By charge to our reserve account □ By cash or check in immediately available funds □ By surrender of $ ................................ (maturity value) of maturing Treasury bills. Pay cash adjust ment, if any— 100,000 □ By check □ 500,000 By credit to our reserve account 1,000,000 l-t Total (Paym ent cannot be made through Treasury T a x and L o a n A ccou n t) changes in delivery hvslructions w ill be accepted) * If this item is checked, the undersigned certifies that the allotted bills will be owned solely by the undersigned. Name of subscriber Insert this tender in yellow envelope marked “Tender for Special 'Treasury Bills’ (Please print) B y ................................. By. (O fficial signature(s) required) T i t l e ............................. .................... T i t l e ............ Address (Banks submitting tenders for customer account must indicate names below, or attach a list) (N am e o f custom er) (N am e of customer) IN S T R U C T I O N S : 1. N o tender for less than $1,000 will be considered, and each tender must be for an even multiple of $1,000 (maturity value). 2. Others than banking institutions will not be permitted to submit tenders except for their own account. Banks submitting tenders for customer account may consolidate competitive tenders at the same price and may consolidate non competitive tenders, provided a list is attached showing the name of each bidder, the amount bid for his account, and method of payment. Forms for this purpose will be furnished on request. 3. I f the person making the tender is a corporation, the tender should be signed by an officer of the corporation authorized to make_ the tender, and the signing of the tender 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.” 4. Tenders will be received without deposit from incorporated banks and trust companies and from responsible and recognized dealers in investment securities. Tenders from others must be accompanied by payment of 2 percent of the face amount of Treasury bills applied for, unless the tenders are accompanied by an express guaranty of payment by an incorporated bank or trust company. 5. If the language of this tender is changed in any respect, which, in the opinion of the Secretary of the Treasury, is material, the tender may be disregarded.