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FEDERAL RESERVE BANK OF N E W YORK Fiscal Agent of the United States r Circular No. 6 4 5 0 "I L December 15, 1969 J OFFERING OF T W O SERIES OF T R E A SU R Y BILLS $1,800,000,000 of 90-Day Bills, Additional Amount, Series Dated Sept. 25, 1969, Due March 26, 1970 (To Be Issued December 26, 1969) $1,200,000,000 of 181-Day Bills, Dated December 26, 1969, Due June 25, 1970 To A ll Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal R eserve D istrict: The following statement was made public December 12 by the Treasury Departm ent: The Treasury announced today that the weekly bill auction normally scheduled for Monday, December 22, will be held instead on Friday, December 19. The day for the auction is being advanced to assure ample time between it and the payment date during the holiday season. The payment and delivery date for these bills will be Friday, December 26. Following is the text of the public notice offering the bills to be auctioned Friday, December 19: T h e T reasu ry D ep artm en t, by this public notice, invites tenders for tw o series of T reasu ry bills to the aggregate am ount of $3,000,000,000, or thereabouts, for cash and in exchange for T reasury bills m aturing D ecem ber 26, 1969, in the am ount of $2,900,840,000, as fo llo w s: 90-day bills (to m aturity date) to be issued D ecem ber 26, 1969, in the am ount of $1,800,000,000, or thereabouts, representing an additional am ount of bills dated S ep tem ber 25, 1969, and to mature M arch 26, 1970, origi nally issued in the am ount of $1,201,115,000, the addi tional and original bills to be freely interchangeable. 181-day bills, for $1,200,000,000, or thereabouts, to be dated D ecem ber 26, 1969, and to mature June 25, 1970. T h e bills of both series will be issued on a discount basis under com petitive and noncom petitive bidding as hereinafter provided, and at m aturity their face am ount will be payable w ithout interest. T h e y will be issued in bearer form only, and in denom inations of $1,000, $5,000, $10,000, $50,000, $100,000, $500,000 and $1,000,000 (m aturity value). T en ders will be received at Federal R eserve B anks and Branches up to the closing hour, on e-thirty p .m ., Eastern Standard tim e, Friday, D ecem ber 19, 1969. T en ders will not be received at the T reasu ry D epartm ent, W a sh in g to n . E ach tender m ust be for an even multiple of $1,000, and in the case of com petitive tenders the price offered m ust be expressed on the basis of 100, with not m ore than three decimals, e.g., 99.925. Fractions m ay not be used. It is urged that tenders be made on the printed form s and forw arded in the special envelopes which will be supplied by Federal R eserve Banks or Branches on application therefor. B anking institutions generally m ay submit tenders for account of custom ers, provided the nam es of the custom ers are set forth in such tenders. O th ers than banking institutions will not be perm itted to subm it tenders except for their ow n account. T enders will be received without deposit from incorporated banks and trust com panies and from responsible and recognized dealers in investm ent securities. T en ders from others m ust be accom panied by paym ent of 2 percent of the face am ount of T reasu ry bills applied for, unless the tenders are accom panied by an express guaranty of paym ent by an incorporated bank or trust com pany. Im m ediately after the closin g hour, tenders will be opened at the Federal R eserve Banks and Branches, follow in g which public announcem ent will be m ade by the T reasu ry D epartm ent of the am ount and price range of accepted bids. T h o se subm itting tenders will be advised of the acceptance or rejection thereof. T h e Secretary of the T reasury exp ressly 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. S u bject to these reservations, noncom petitive tenders for each issue for $200,000 or less w ithout stated price from any one bidder w ill be accepted in full at the average price (in three d ecim als) of accepted com petitive bids for the respective issues. S ettlem ent for accepted tenders in accordance with the bids m u st be m ade or com pleted on D ecem ber 26, 1969, in cash or other im m ed i ately available funds or in a like face am ount of T re a su ry bills m aturing D ecem ber 26, 1969; provided, how ever, that if tenders are submitted to a Federal Reserve B ank or B ranch that w ill be closed on D ecem ber 26, settlem ent m ust be com pleted at such Bank or Branch on either D ecem ber 24, or on D e ce m b e r 29 with paym ent o f three days’ accrued interest unless settlem ent is made with T reasury bills m aturing D ecem ber 26, 1969. C ash and exchange tenders w ill receive equal treatment. C ash ad ju st m ents will be m ade for differences betw een the par value of m aturing bills accepted in exchange and the issue price o f the new bills. T h e incom e derived from T reasury bills, w hether interest or gain from the sale or other disposition of the bills, does not have any exem ption, as such, and loss from the sale or other disposition of T reasu ry bills does not have any special treat m ent, as such, under the Internal Revenue Code of 1954. T h e bills are subject to estate, inheritance, gift or other excise taxes, whether Federal or State, but are exem p t from all taxa tion now or hereafter im posed on the principal or interest thereof by any State, or any of the possessions of the U n ited States, or by any local taxing authority. F or purposes o f taxation the am ount of discount at which T re asu ry bills are originally sold by the U n ited States is considered to be interest. U nd er Sections 4 5 4 (b ) and 1 22 1 (5 ) of the Internal R evenue C ode of 1954, the am ount o f discount at w hich 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 cco rd in g ly , the ow ner of T reasury bills (other than life insurance c o m panies) issued hereunder need include in his incom e tax return only the difference betw een the price paid for such bills, whether on original issue or on subsequent purchase, and the am ount actually received either upon sale or redem ption at m aturity during the taxable year for which the return is m ade, as ordinary gain or loss. T reasury D epartm ent Circular N o . 418 (current revision) and this notice prescribe the term s of the T re asu ry bills and govern the conditions of their issue. Copies of the circular m ay be obtained from any Federal R eserve B ank or Branch. This Bank will receive tenders for both series up to 1 :30 p.m., Eastern Standard time, Friday, December 19 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 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. This circular was printed before the results of the bidding for Treasury bills to be issued December 18, 1969 were available; those results will be announced after release by the Treasury Department. A lfr e d H ayes, IM PORTANT— (1) Closing date for receipt of tenders is Friday, December 19, 1969. (2) The current offering is for 90-day and 181-day bills. President.
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