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FEDERAL RESERVE BANK OF N E W YORK Fiscal Agent of the United States r Circular No. 5 9 8 8 L May 31, 1967 OFFERING OF TWO SERIES OF TREASURY BILLS $1,300,000,000 of 91-Day Bills, Additional Amount, Series Dated March 9,1967, D u e September 7,1967 (To Be Issued June 8, 1967) $1,000,000,000 of 182-Day Bills, Dated June 8, 1967, Due December 7, 1967 To A ll Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve District: Following is the text of a notice issued by the Treasury Department, released for publication today at 4 p.m., Eastern Daylight Saving tim e: The Treasury Department, by this public notice, invites tenders for tw o series o f Treasury bills to the aggregate amount of $2,300,000,000, or thereabouts, for cash and in ex change for Treasury bills maturing June 8, 1967, in the amount of $2,300,692,000, as follow s: 91-day bills (to maturity date) to be issued June 8, 1967, in the amount o f $1,300,000,000, or thereabouts, repre senting an additional amount of bills dated March 9, 1967, and to mature September 7, 1967, originally issued in the amount o f $1,000,488,000, the additional and original bills to be freely interchangeable. 182-day bills, for $1,000,000,000, or thereabouts, to be dated June 8, 1967, and to mature Decem ber 7, 1967. The bills o f both series will be issued on a discount basis under competitive and noncom petitive bidding as hereinafter provided, and at maturity their face amount will be payable without interest. Th ey will be issued in bearer form only, and in denominations o f $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 D aylight Saving time, M onday, June 5, 1967. Tenders will not be received at the Treasury Department, W ashington. Each tender must be for an even multiple o f $1,000, and in the case of competitive tenders the price offered must be expressed on the basis o f 100, with not m ore than three decimals, e.g., 99.925. Fractions may not be used. It is urged that tenders be made on the printed form s 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 o f 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 ow n 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, follow in g which public announcement will be made by the Treasury Department o f the amount and price range of accepted bids. Those sub mitting 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 reservations, noncom petitive 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 June 8, 1967, in cash or other immediately available funds or in a like face amount of Treasury bills maturing June 8, 1967. Cash and exchange tenders will receive equal treatment. Cash adjust ments w ill 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 incom e 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 o f 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 im posed on the principal or interest thereof by any State, or any of the possessions o f the United States, or by any local taxing authority. For purposes of taxation the amount o f discount 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 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. A ccordin gly, the owner of Treasury bills (other than life insurance com panies) issued hereunder need include in his incom e 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 Departm ent 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 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 Daylight Saving time, Monday Tune 5 1967, at the Securities Department of its Head Office and at its Buffalo Branch. Tender fo rm s’ 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 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 funds or in maturing Treasury bills. Results of the last weekly offering of Treasury bills (91-day bills to be issued June 1, 1967 representing an addi tional amount of bills dated August 31, 1966, maturing August 31, 1967; and 182-day bills to be issued June 1 1967 representing an additional amount of bills dated November 30, 1966, maturing November 30, 1967) are shown on the reverse side of this circular. - A lfred H ayes, President. (o v e r ) RESULTS OF LA ST W E E K L Y O FFE R IN G OF T R E A S U R Y BILLS (T W O SERIES T O BE ISSUED JUNE 1, 1967) Range o f A ccepted Com petitive Bids 91-Day Treasury Bills Maturing August 31,1967 Price 182-Day Treasury Bills Maturing N ovem ber 30,1967 Approx. equiv. annual rate Price Approx. equiv. annual rate H i g h ......................................... 99.133 3.430% 98.124 3.711% L oW ......................................... 99.118 3.489% 98.105 3.748% Average ................................... 99.121 3.477% ' 98.113 3.733% ! 1 These rates are on a bank discount basis. The equivalent coupon issue yields are 3.57 percent for the 91-day bills, and 3.87 percent for the 182-day bills. (91 percent of the amount of 91-day bills bid for at the low price was accepted.) (44 percent of the amount of 182-day bills bid for at the low price was accepted.) Total Tenders A p p lied fo r and A ccepted (B y Federal Reserve Districts) 91-Day Treasury Bills Maturing August 31,1967 .... Kansas City . . . San Francisco T ota l . . . ... $ 18,984,000 Applied for Accepted Applied for District 182-Day Treasury Bills Maturing N ovem ber 30,1967 $ 8,984,000 $ 14,633,000 $ 4,633,000 1,667,811,000 920,721,000 1,388,176,000 765,156,000 24,515,000 12,515,000 16,643,000 8,643,000 27,693,000 22,693,000 23,008,000 13,008,000 10,176,000 10,176,000 3,755,000 3,755,000 50,287,000 33,822,000 28,384,000 16,048,000 380,543,000 122,744,000 334,563,000 65,283,000 46,183,000 37,557,000 28,499,000 17,059,000 25,320,000 11,223,000 17,879,000 7,054,000 21,516,000 21,516,000 14,602,000 14,602,000 24,012,000 15,922,000 15,702,000 9,702,000 108,169,000 82,764,000 87,150,000 76,050,000 $2,405,209,000 $1,300,637,000a $1,972,994,000 a Includes $228,802,000 noncompetitive tenders accepted at the average price of 99.121. b Includes $98,039,000 noncompetitive tenders accepted at the average price of 98.113. Accepted $1,000,993,000b
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