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FEDERAL RESERVE BANK OF N E W YORK Fiscal Agent of the United States 'Circular No. 6 1 9 8 ' August 7, 1968 - OFFERING OF TW O SERIES OF TREASURY BILLS $1,600,000,000 of 91-Day Bills, Additional Amount, Series Dated May 16,1968, Due November 14,1968 (To Be Issued August 15, 1968) $1,100,000,000 of 182-Day Bills, Dated August 15, 1968, Due February 13, 1969 To All 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 time: T h e T r e a s u ry D epa rtm en t, b y this pu b lic n otice, invites ten ders f o r t w o series o f T re a s u ry bills to the a g g reg a te a m o u n t o f $2,700,000,000, or th erea b ou ts, fo r cash and in e x ch a n ge fo r T re a s u ry bills m a tu rin g A u g u s t 15, 1968, in the a m ou n t o f $2,601,927,000, as fo llo w s : 91-day bills ( t o m atu rity da te) to be issued A u g u s t 15, '1968, in the a m ou n t o f $1,600,000,000, o r th ereabou ts, rep resen tin g an a ddition al a m ou n t o f bills dated M a y 16, 1968, and to m ature N o v e m b e r 14, 1968, o rig in a lly issued in the am ou nt o f $1,101,062,000, the a ddition al and origin a l bills t o be freely in terch angeable. 182-day bills, fo r $1,100,000,000, o r th erea b ou ts, to be dated A u g u s t 15, 1968, and t o m ature F e b ru a ry 13, 1969. T h e bills o f b o th series w ill b e issued on a d iscou n t basis u n der com p e titiv e and n o n co m p e titiv e b id d in g as hereinafter p ro v id e d , and at m aturity their fa ce a m ou n t w ill be pa ya b le w ith ou t interest. T h e y w ill be issued in bearer fo r m on ly, and in den o m in a tio n s o f $1,000, $5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000 (m a tu rity v a lu e ). T e n d e rs w ill be receiv ed at F ederal R e serv e B anks and B ra n ch es up to the clo s in g h ou r, on e -th irty p.m., E astern D a y lig h t S a vin g tim e, M on d a y, A u g u s t 12, 1968. T e n d e rs w ill n o t b e receiv ed at th e T r e a s u ry D ep a rtm en t, W a s h in g to n . E a ch ten der m u st be f o r an even m u ltiple o f $1,000, and in the case o f co m p e titiv e ten ders the p rice offered m ust be e x p ressed o n th e basis o f 100, w ith n o t m o r e than three d eci m als, e.g., 99.925. F ra ction s m a y n ot be used. It is u rged that ten ders b e m ad e on the printed fo rm s and fo rw a rd e d in th e specia l e n v e lo p es w h ich w ill b e sup plied b y Federal R e se rv e B anks o r B ra n ch es on a pp lication th erefor. B a n k in g in stitu tions gen era lly m a y su b m it ten ders for a cco u n t o f cu stom ers, p ro v id e d the nam es o f th e cu stom ers are set forth in such ten ders. O th ers than b a n k in g in stitu tions w ill n o t be perm itted to subm it ten ders e x ce p t fo r their o w n a c cou n t. T e n d e rs w ill be receiv ed w ith o u t d e p o s it fr o m in co rp o ra te d banks and trust com p a n ies and fr o m respon sib le and re c o g n iz e d dealers in in vestm en t securities. T e n d e rs fr o m oth ers m u st be a cco m p a n ied b y p a y m en t o f 2 p ercen t o f the fa ce a m o u n t o f T re a s u ry bills app lied fo r , unless th e tenders are a cco m p a n ie d b y an exp ress gu aranty o f pa ym en t b y an in co rp o ra te d b a n k o r trust com p a n y . Im m e d ia te ly after th e c lo s in g h our, ten ders w ill be op en ed at the F ed era l R e s e rv e B anks and B ran ch es, fo llo w in g w h ich p u blic a n n ou n cem en t w ill be m ad e b y the T r e a s u ry D e p a rt m en t o f the a m ou n t and price ra n g e o f a cce p te d bids. T h o s e su b m ittin g ten ders w ill be advised o f the a ccep ta n ce o r r e je c tion th ereof. T h e S ecreta ry o f the T r e a s u ry ex p re s sly re serves the rig h t to a ccep t o r re je ct a n y o r all ten ders, in w h o le or in part, and his a ction in any such resp ect shall be final. S u b je ct to these reserva tion s, n o n co m p e titiv e ten ders fo r each issue fo r $200,000 o r less w ith ou t stated p rice fr o m any on e b idd er w ill be a cce p te d in full at the a v era g e price (in three d ecim a ls) o f a ccep ted com p etitiv e bids fo r the resp ective issues. S ettlem en t fo r a ccep ted ten ders in a c c o r d ance w ith th e b id s m u st be m ade o r co m p le te d at the F ed era l R eserv e B ank on A u g u s t IS, 1968, in cash or oth er im m ediately available fun ds o r in a like fa ce a m ou n t o f T re a s u ry bills m a tu rin g A u g u s t 15, 1968. Cash and ex ch a n g e ten ders w ill receive equal treatm ent. Cash adju stm en ts w ill be m ad e fo r d ifferen ces betw een the par value o f m a tu rin g bills a cce p te d in e x ch a n g e a n d th e issue p rice o f th e n ew bills. T h e in co m e derived fr o m T re a s u ry bills, w h eth e r interest o r gain fro m the sale o r o th e r d isp osition o f the bills, does n ot have a n y ex em p tion , as such, and lo s s fro m the sale o r o th e r d isp osition o f T re a s u ry b ills d oes n ot have any special treatm ent, as such, under the In tern a l R even u e C o d e o f 1954. T h e bills are su b ject t o estate, in heritance, g ift or o th e r e x cise ta xes, w h eth er F ederal o r State, but are ex em p t fro m all taxation n o w o r h ereafter im p osed on the prin cip a l o r in ter est th e re o f b y a n y State, o r any o f the p ossession s o f the U n ited States, o r b y a n y lo ca l ta x in g au th ority. F o r p u rp oses o f ta x ation the am ou nt o f d iscou n t at w h ich T re a s u ry bills are o rig in a lly s o ld b y the U n ited States is con sid ered to be interest. U n d er S ection s 4 5 4 (b ) and 1221(5) o f the In tern al R even u e C od e o f 1954, the a m ou n t o f d iscou n t at w h ich bills issued h ereun der are s o ld is n ot con sid e re d to a ccru e until such bills are sold, red eem ed o r o th erw ise d is p o se d o f, and such bills are e x clu d ed fro m con sid era tion as capital assets. A c c o r d in g ly , the o w n e r o f T re a s u ry bills (o th e r than life in suran ce co m p a n ie s ) issued h ereun der need in clu d e in his in co m e ta x return o n ly the differen ce b etw een the p rice paid fo r such bills, w hether o n orig in a l issue or on subsequen t purchase, and the a m ou n t a ctu a lly receiv ed either u p on sale o r red em p tion at m a tu rity d u rin g the ta x ab le yea r fo r w h ich the return is m ade, as ord in a ry gain o r loss. T r e a s u ry D ep a rtm en t Circular N o . 418 (cu rr e n t re v is io n ) and this n o tice p rescrib e the term s o f th e T r e a s u ry bills and g o v e rn the con d ition s o f th eir issue. C op ies o f th e circu la r m a y be ob ta in ed fr o m a n y F ed era l R eserv e B a n k o r B ran ch . This Bank will receive tenders for both series up to 1 :30 p.m., Eastern Daylight Saving time, Monday, August 12 1968, 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 the enclosed 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 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 August 8 1968 renresentincr ™ additional amount of bills dated May 9, 1968, maturing November 7, 1968; and 182-day bills dated A iIn 8 iqaq maturing February 6, 1969) are shown on the reverse side of this circular. august 8, IV68, A lfred H a ye s, President. ( over) RESULTS OF LAST WEEKLY OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED AUGUST 8, 1968) Range of Accepted Competitive Bids 91-Day Treasury Bills Maturing November 7,1968 Price 182-Day Treasury Bills Maturing February 6,1969 A pprox. equiv. annual rate Price A pprox. equiv. annual rate High .................................... 98.766 4.882% 97.436 5.072% L o w ...................................... 98.752 4.937% 97.413 5.117% A v era ge................................ 98.760 4.905%! 97.422 5.099%! 1 T h e s e rates are on a bank d iscou n t basis. T h e equivalent co u p o n issue yield s are 5.04 p ercen t fo r the 91-day bills, and 5.31 p ercen t fo r the 182-day bills. (9 percent o f the amount of 91-day bills bid for at the low price was accepted.) (14 percent of the amount of 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 November 7,1968 Applied for District B oston ...................................... $ 13,619,000 182-Day Treasury Bills Maturing February 6,1969 Accepted $ 13,619,000 Accepted Applied for $ 24,717,000 $ 14,717,000 New York .................. .......... 1,931,074,000 1,095,774,000 1,756,078,000 833,178,000 Philadelphia ................ .......... 29,466,000 17,452,000 13,326,000 5,326,000 Cleveland .................... .......... 35,468,000 35,468,000 24,895,000 18,345,000 R ich m on d.................... .......... 24,272,000 24,272,000 5,509,000 4,509,000 Atlanta .......................... .......... 30,790,000 26,790,000 37,734,000 20,604,000 ........................ .......... 215,243,000 189,456,000 145,302,000 92,802,000 St. Louis ...................... .......... 55,331,000 45,511,000 39,948,000 26,148,000 Minneapolis .................. .......... 21,599,000 21,599,000 19,636,000 15,636,000 Kansas C i t y .................. ........ 23,603,000 22,704,000 10,074,000 10,073,000 Dallas ............................ .......... 25,426,000 17,426,000 19,031,000 11,031,000 126,450,000 90,295,000 181,401,000 47,729,000 Chicago San Francisco .............. T otal .................. .......... $2,532,341,000 $ 1,600,366,000a $2,277,651,000 a Includes $267,356,000 noncompetitive tenders accepted at the average price of 98.760. b Includes $114,376,000 noncompetitive tenders accepted at the average price of 97.422. $1,100,098,000b
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