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FED ER AL RESERVE BANK O F NEW YORK Fiscal Agent of the United States TCircular No. 6 2 0 6 1 L August 26, 1968 J OFFERING OF TWO SERIES OF TREASURY BILLS $1,600,000,000 of 91-Day Bills, Additional Amount, Series Dated June 6, 1968, Due December 5, 1968 (To Be Issued September 5, 1968) $1,100,000,000 of 182-Day Bills, Dated September 5, 1968, Due March 6, 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: The Treasury Department, by this public notice, invites tenders for two series of Treasury bills to the aggregate amount of $2,700,000,000, or thereabouts, for cash and in exchange for Treasury bills maturing September 5, 1968, in the amount of $2,600,409,000, as follows: 91-day bills (to m aturity date) to be issued September 5, 1968, in the amount of $1,600,000,000, or thereabouts, representing an additional amount of bills dated June 6, 1968, and to mature December 5, 1968, originally issued in the amount of $1,099,439,000, the additional and original bills to be freely interchangeable. 182-day bills, for $1,100,000,000, or thereabouts, to be dated September 5, 1968, and to mature March 6, 1969. The bills of both series w ill be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided, and at m aturity their face amount w ill be payable without interest. They w ill 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 (m aturity value). Tenders w ill be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern D a y light Saving time, Friday, August 30, 1968. Tenders w ill 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. I t is urged that tenders be made on the printed forms and forwarded in the special envelopes which w ill 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 w ill not be permitted to submit tenders except for their own account. Tenders w ill 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. Im m ediately after the closing hour, tenders w ill be opened at the Federal Reserve Banks and Branches, following which public announcement w ill be made by the Treasury Departm ent of the amount and price range of accepted bids. Those sub m itting tenders w ill 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 w ill 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 w ith the bids must be made or completed at the Federal Reserve Bank on September 5, 1968, in cash or other immediately available funds or in a like face amount of Treasury bills maturing September 5, 1968. Cash and exchange tenders w ill receive equal treatment. Cash adjustments w ill 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. F or 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 Intern al 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 m aturity 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 of the Treasury bills and govern the conditions of their issue. Copies of the circular mav 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, Friday, August 30 1968, at the Securities Department of its Head Office and at its Buffalo Branch. Tender forms for the r<Xoecti * series are enclosed. Please use the appropriate forms to submit tenders and return them in an envelope marked “Tend^ for Treasury Bills.” Tenders may be submitted by telegraph, subject to written confirmation; they may not be sub1* mitted by telephone. Payment for the Treasury bills cannot be made by credit through the Treasury Tax and L Account. Settlement must be made in cash or other immediately available funds or in maturing Treasury bills This circular was printed before the results of the bidding for Treasury bills to be issued August 29 1968 available; those results will be announced after release by the Treasury Department. b ’ Here A lfr e d • • Closing date for receipt of tenders is Friday, August 30. H ayes, ; President
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