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F E D E R A L R E S E R V E BANK O F NEW YO R K F i s c a l A gent of th e U n ite d S ta te s C ircu lar N o . 6631 N ovem ber 2, 1970 BIDDING AND OTHER PROCEDURES FOR TREASURY’S CURRENT NOTE AUCTION To A ll B a n k i n g In st i tu t i o n s , and Others Concerned, in the Se cond F ederal R e s e r v e District: The following statement was issued today by the Treasury Department: The Treasury today said that bidding and other procedures in the T reasury's new $2 billion cash financing will very closely follow the standard procedures used in regular T reasury bill auctions. The new securities, which will carry a 6-3/4 percent coupon and have an 18-month m aturity, will be issued on November 16, 1970, and mature on May 15, 1972. Subscription form s will be available in the usual way through Federal Reserve Banks and Branches. They will also be available at the Office of the T reasu rer of the United States, Washington, D.C. 20220. Some banks may wish to use the services of correspon dents. Books will close at 1:30 p.m ., Eastern Standard time, on Thursday, November 5, 1970, and tenders received after that time will not be accepted. In the case of competitive bids, prices m ust be expressed on the bidding form on the basis of 100 and two decimals, e.g., 100.25. The 6-3/4 percent coupon on this issue is somewhat higher than m arket yields prevailing for issues with comparable m aturities already in the m arket. To avoid tax problems which would result from discounts lower than 99.76 percent of par, in no event will the Treasury accept bids below that price. Bidders for sm aller amounts (i.e., up to $200,000) willing to accept the average of p rices bid in the auction can do so by appropriately indicating in the space provided on the tender form that their tenders are noncompetitive. These noncompetitive tenders will be awarded in full at the average of the accepted competitive bids. No deposits will be required with tenders from com m ercial banks for their own account or from certain other classes of subscribers. Others, including individuals, must make a 5 percent deposit with their bid. Qualified depositaries will be allowed to pay 50 percent of the subscription price by crediting Treasury Tax and Loan Accounts. Complete details with regard to the offering will be found in the official offering circular. The term s of the offering of the new notes and the procedures for submitting tenders are contained in our C ircular No. 6629, which was sent to you on October 31. Alfred Hayes, President.
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