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FEDERAL RESERVE BANK OF N EW YORK Fiscal Agent o f the United States f Circular No. 5 9 4 3 1 L February 15, 1967 J OFFERING OF TWO SERIES OF TREASURY BILLS $1,300,000,000 of 91-Day Bills, Additional Amount, Series Dated November 25, 1966, Due May 25, 1967 (To Be Issued February 23, 1967) $1,000,000,000 of 182-Day Bills, Dated February 23, 1967, Due August 24, 1967 To A ll Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve D istrict: Following is the text o f 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 o f $2,300,000,000, or thereabouts, for cash and in exchange for Treasury bills maturing February 23, 1967, in the amount of $2,303,191,000, as follow s: 91-day bills (to maturity date) to be issued February 23, 1967, in the amount o f $1,300,000,000, or thereabouts, representing an additional amount of bills dated N o vember 25, 1966, and to mature May 25, 1967, origi nally issued in the amount of $999,619,000, the addi tional and original bills to be freely interchangeable. 182-day bills, for $1,000,000,000, or thereabouts, to be dated February 23, 1967, and to mature August 24, 1967. The bills o f 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, M onday, February 20, 1967. 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. 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 o f 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 o f 2 percent o f the face amount of Treasury bills applied for, unless the tenders are accompanied by an express guaranty o f 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 o f accepted bids. Those submitting tenders will be advised o f the acceptance or rejection thereof. The Secretary o f 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 reserva tions, 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) o f accepted competitive bids for the respective issues. Settlement fo r accepted tenders in accordance with the bids must be made or completed at the Federal Reserve Bank on February 23, 1967, in cash or other immediately available funds or in a like face amount o f Treasury bills maturing February 23, 1967. Cash and exchange tenders will receive equal treatment. Cash adjustments will be made for differences between the par value o f maturing bills accepted in exchange and the issue price o f the new bills. The income derived from Treasury bills, whether interest or gain from the sale or other disposition o f 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 treatment, as such, under the Internal Revenue Code o f 1954. The bills are subject to estate, inheritance, gift or other excise taxes, whether Federal or State, but are exempt from all taxation now or here after imposed on the principal or interest thereof by any State, or any o f the possessions o f the United States, or by any local taxing authority. For purposes o f taxation the amount o f dis count at which Treasury bills are originally sold by the United States is considered to be interest. Under Sections 454(b) and 1221(5) o f the Internal Revenue Code o f 1954, the amount o f 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 o f Treasury bills (other than life insurance companies) 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 No. 418 (current revision) and this notice prescribe the terms o f the Treasury bills and govern the conditions o f their issue. Copies o f 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, (Monday, February 20, 1967, at the Securities Department o f 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 an envelope marked “ Tender for Treasury Bills.” Tenders may be submitted by telegraph, subject to written confirmation; they may not be submitted by telephone. Payment fo r the Treasury bills cannot be made by credit through the Treasury T ax and Loan A c c o u n t' Settlement must be made in cash or other immediately available funds or in maturing Treasury bills. Results o f the last weekly offering o f Treasury bills (91-day bills to be issued February 16, 1967, representing an additional amount o f bflls dated November 17, 1966, maturing May 18, 1967; and 182-day bills dated February 16, 1967, maturing August 17, 1967) are shown on the reverse side o f this circular. A lfred H a y e s , President. ( over) RESULTS OF LAST W EEKLY OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED FEBRUARY 16, 1967) Range of Accepted Competitive Bids 91-Day Treasury Bills Maturing M ay 18,1967 182-Day Treasury Bills Maturing August 17,1967 Price Approx. equiv. annual rate Approx. equiv. P rice annual rate ............................ 98.857 4.522% 97.694 4.561% L ow .............................. 98.840 4.589% 97.678 4.593% ..................... 98.843 4 .57 7% 1 97.684 4.581% ! H igh Average 1 These rates are on a bank discount basis. The equivalent coupon issue yields are 4.70 percent for the 91-day bills, and 4.75 percent for the 182-day bills. (43 percent o f the amount o f 91-day bills bid for at the low price was accepted.) (78 percent o f the amount o f 182-day bills bid for at the low price was accepted.) Total Tenders Applied for and Accepted (By Federal Reserve Districts) 91-Day Treasury Bills Maturing M ay 18,1967 Applied for District Boston .............................. $ 22,248,000 182-Day Treasury Bills Maturing August 17,1967 Accepted $ 11,522,000 Applied fo r $ 24,300,000 Accepted $ 2,000,000 1,594,871,000 793,016,000 1,495,912,000 676,762,000 ................... 25,165,000 13,165,000 12,575,000 4,175,000 Cleveland .......................... 41,612,000 31,312,000 21,265,000 11,265,000 Richmond ........................ 18,087,000 16,947,000 9,280,000 3,191,000 A tla n ta .............................. 50,896,000 32,956,000 29,175,000 12,675,000 ............................ 343,247,000 155,491,000 312,555,000 97,792,000 St. Louis .......................... 58,269,000 38,528,000 32,066,000 9,366,000 Minneapolis ................... 20,043,000 13,143,000 11,386,000 5,166,000 Kansas City ................... 43,999,000 43,999,000 10,504,000 9,372,000 Dallas ................................ 24,034,000 14,034,000 11,109,000 6,109,000 San F r a n c is c o ................. 202,114,000 137,239,000 190,926,000 162,376,000 N ew Y ork ........................ Philadelphia Chicago T otal ........................... $2,444,585,000 $1,301,352,000 $2,161,053,000 a Includes $249,627,000 noncompetitive tenders accepted at the average price of 98.843. b Includes $88,909,000 noncompetitive tenders accepted at the average price of 97.684. $1,000,249,000b
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