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FEDERAL RESERVE BANK OF N EW YORK Fiscal Agent of the United States r Circular No. 6 4 5 6 1 L December 22, 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 October 2, 1969, Due April 2, 1970 (To Be Issued January 2, 1970) $1,200,000,000 of 181-Day Bills, Dated January 2, 1970, Due July 2, 1970 T o A ll Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal R eserve D istrict: Following is the text of a notice issued by the Treasury Department, released at 4 p.m. today: T h e T reasu ry D epartm ent, by this public notice, invites tenders for tw o series of T reasu ry bills to the aggregate am ount o f $3,000,000,000, or thereabouts, for cash and in exchange for T reasu ry bills m aturing January 2, 1970, in the am ount of $2,911,209,000, as fo llo w s: 90-day bills (to m aturity date) to be issued January 2, 1970, in the am ount of $1,800,000,000, or thereabouts, representing an additional am ount of bills dated O c to ber 2, 1969, and to mature A pril 2, 1970, originally issued in the am ount of $1,208,450,000, the additional and original bills to be freely interchangeable. 181-d ay bills, for $1,200,000,000, or thereabouts, to be dated January 2, 1970, and to mature July 2, 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 valu e). T en ders will be received at Federal R eserve B anks and Branches up to the closing hour, one-thirty p.m ., Eastern Standard time, M on d ay, D ecem ber 29, 1969. T en ders will not be received at the T reasury D epartm ent, W a sh in g to n . Each 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 w hich will be supplied by Federal R eserve Banks or Branches on application therefor. B anking institutions generally m ay subm it 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 submit tenders except for their ow n account. T en d ers 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 o f 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 closing hour, tenders will be opened at the Federal R eserve Banks and Branches, follow ing which public announcem ent will be m ade by the T reasury D epartm ent of the am ount and price range of accepted bids. T h ose sub m itting tenders will be advised of the acceptance or rejection thereof. T h e Secretary of the T reasury 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 w ithout stated price from any one bidder will be accepted in full at the average price (in three decim als) of accepted com petitive bids for the respective issues. Settlem ent for accepted tenders in accordance with the bids m ust be made or com pleted at the Federal R eserve Bank on January 2, 1970, in cash or other im m ediately available funds or in a like face am ount of T reasury bills m aturing January 2, 1970. Cash and exchange tenders will receive equal treatm ent. Cash adjust m ents will be made for differences betw een the par value of m aturing bills accepted in exchange and the issue price of the new bills. T h e incom e derived from T reasury bills, whether 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 ment, as such, under the Internal Revenue Code of 1954. T h e bills are subject to estate, inheritance, gift or other excise taxes, w hether Federal or State, but are exem pt 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 nited States, or by any local taxing authority. F or purposes of taxation the am ount of discount at which T reasu ry bills are originally sold by the U nited States is considered to be interest. U nder Sections 4 5 4 (b ) and 1 22 1(5) of the Internal Revenue C ode o f 1954, the am ount 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 ccord in gly, the ow ner of T reasu ry bills (other than life insurance co m 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 am ount actually received either upon sale or redem ption at m aturity during the taxable year for which the return is made, as ordinary gain or loss. T reasu ry D ep artm ent Circular N o . 418 (current revision) and this notice prescribe the term s of the T reasu ry bills and govern the conditions of their issue. Copies of the circular m ay be obtained from any Federal Reserve Bank or Branch. This Bank will receive tenders for both series up to 1 :30 p.m., Eastern Standard time, Monday, December 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 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 (90-day bills to be issued December 26, 1969, representing an additional amount of bills dated September 25, 1969, maturing March 26, 1970; and 181-day bills dated December 26, 1969, maturing June 25, 1970) are shown on the reverse side of this circular. A lfred H a y es , President. Please note that the current offering is for 90-day and 181-day Treasury bills. ( over ) RESULTS OF LAST WEEKLY OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED DECEMBER 26, 1969) Range of Accepted Competitive Bids 90-Day Treasury Bills 181-Day Treasury Bills Maturing March 2 6 ,1 97 0 Maturing June 25,1 97 0 _ Price Approx. equiv. annual rate Price Approx. equiv. annual rate H i g h ......................................... 98.060 7.760% 96.094 7.769% Low ......................................... 98.041 7.836% 96.057 7.842% Average ................................... 98.049 7.804% ! 96.071 7.815% ! 1 These rates are on a bank discount basis. The equivalent coupon issue yields are 8.07 percent for the 90-day bills, and .25 percent for the 181-day bills. (52 percent of the amount of 90-day bills bid for at the low price was accepted.) (47 percent of the amount of 181-day bills bid for at the low price was accepted.) Total Tenders Applied for and Accepted (By Federal Reserve Districts) 90-Day Treasury Bills 181-Day Treasury Bills Maturing March 26 ,1 97 0 Maturing June 25,1970 $ 46,331,000 Applied for Accepted Applied for District $ 38,931,000 $ 20,007,000 Accepted $ 10,007,000 1,737,369,000 1,255,329,000 1,304,927,000 823,503,000 34,177,000 19,177,000 21,314,000 11,314,000 39,257,000 39,222,000 53,988,000 50,940,000 30,203,000 25,243,000 13,489,000 11,489,000 46,551,000 33,876,000 38,762,000 28,367,000 198,831,000 167,043,000 186,036,000 153,836,000 51,303,000 41,719,000 31,764,000 25,164,000 ................. 14,182,000 13,182,000 8,814,000 8,814,000 Kansas City ................. 35,865,000 35,627,000 29,739,000 29,589,000 Dallas ............................ 26,661,000 18,181,000 24,277,000 15,277,000 San F r a n c is co ............... 171,448,000 112,528,000 130,222,000 31,719,000 T o t al ...................... $2,432,178,000 ........... Minneapolis $1,800,058,000a $1,863,339,000 a Includes $339,315,000 noncompetitive tenders accepted at the average price of 98.049. b Includes $203,692,000 noncompetitive tenders accepted at the average price of 96.071. $1,200,019,000b