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FEDERAL RESERVE BANK OF N EW YORK Fiscal Agent of the United States r Circular No. 6 3 9 4 1 L August 25, 1969 J OFFERING OF TWO SERIES OF TREASURY BILLS 1,600,000,000 of 91-Day Bills, Additional Amount, Series Dated June 5,1969, Due December 4, 1969 (To Be Issued September 4, 1969) $1,200,000,000 of 182-Day Bills, Dated September 4, 1969, Due March 5, 1970 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 at 4 p.m. today: T he Treasury Department, by this public notice, invites tenders for tw o series o f Treasury bills to the aggregate amount o f $2,800,000,000, or thereabouts, for cash and in ex change for Treasury bills maturing September 4, 1969, in the amount of $2,802,014,000, as follow s: 91-day bills (to maturity date) to be issued September 4, 1969, in the amount o f $1,600,000,000, or there abouts, representing an additional amount of bills dated June 5, 1969, and to mature D ecem ber 4, 1969, originally issued in the amount o f $1,301,356,000, the additional and original bills to be freely inter changeable. 182-day bills, for $1,200,000,000, or thereabouts, to be dated September 4, 1969, and to mature M arch 5, 1970. The bills o f both series w ill 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. Th ey 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 (maturity value). Tenders will be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern D ay light Saving time, Friday, August 29, 1969. Tenders w ill not be received at the Treasury Department, W ashington. 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 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 en velopes 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 custom ers are set forth in such tenders. Others than banking institutions will not be permitted to submit tenders except for their ow n ac count. Tenders will be received without deposit from incor porated banks and trust companies and from responsible and recognized dealers in investment securities. Tenders from others must be accom panied by payment of 2 percent o f 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 w ill be opened at the Federal Reserve Banks and Branches, follow ing which public announcement will be made by the Treasury Department o f the am ount and price range o f accepted bids. T h ose submitting tenders will be advised o f the acceptance or rejection thereof. T h e Secretary of the Treasury expressly reserves the right to accept or reject any or all tenders, in w hole 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) o f accepted competitive bids for the respective issues. Settlement for accepted tenders in accordance with the bids must be made or com pleted at the Federal Reserve Bank on September 4, 1969, in cash or other immediately available funds or in a like face amount of Treasury bills maturing Sep tember 4, 1969. 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 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 of Treasury bills does not have any special treat ment, 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 taxa tion now or hereafter im posed on the principal or interest thereof by any State, or any o f 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 inter est. Under Sections 454(b) and 1221(5) o f the Internal R ev e nue 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. A ccordin gly, the ow ner 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 Department Circular N o. 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, Friday, August 29 1969, 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 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 This circular was printed before the results of the bidding for Treasury bills to be issued August 28, 1969 were available; those results will be announced after release by the Treasury Department. A lfred H ayes, President. Closing date for receipt of tenders is Friday, August 29.
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