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FEDER AL RESERVE BANK O F NEW YORK Fiscal Agent of the United States c C ircular N o. 6 9 4 0 M ay 16, 1972 ] OFFERING OF TWO SERIES OF TREASURY BILLS $2,300,000,000 of 91-Day Bills, Additional Amount, Series Dated February 24,1972, Due August 24,1972 (To Be Issued May 25, 1972) $1,800,000,000 of 183-Day Bills, Dated May 25, 1972, Due November 24, 1972 To A ll Incorporated B anks and T ru st Companies, and Others Concerned, in the Second Federal Reserve D istrict: Following is the text of a notice issued by the Treasury Department, released at 4 p.m. today: The T reasury Departm ent, by this public notice, invites tenders fo r two series of T reasury bills to the aggregate am ount of $4,100,000,000, or thereabouts, fo r cash and in exchange fo r T reas ury bills m aturing M ay 25, 1972, in the amount of $4,205,430,000, as follow s: 91-day bills (to m aturity date) to be issued M ay 25, 1972, in the amount of $2,300,000,000, or thereabouts, representing an additional amount of bills dated F ebru ary 24, 1972, and to m ature A ugust 24, 1972 (C U S IP No. 912793 P A 8 ), originally issued in the amount of $1,802,700,000, the additional and original bills to be freely interchangeable. 183-day bills, fo r $1,800,000,000, or thereabouts, to be dated M ay 25, 1972, and to m ature November 24, 1972 (C U S IP No. 912793 P N 0 ). The bills of both series will be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided, and at m aturity their face amount will be payable w ithout interest. They will be issued in bearer form only, and in denominations of $10,000, $15,000, $50,000, $100,000, $500,000 and $1,000,000 (m aturity value). Tenders will be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., E astern Daylight Saving time, Monday, M ay 22, 1972. Tenders will not be received at the T reasury Departm ent, W ashington. Each tender m ust be for a minimum of $10,000. Tenders over $10,000 must be in m ulti ples of $5,000. In the case of competitive tenders the price offered must be expressed on the basis of 100, w ith not more 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 forw arded in the special envelopes which will be supplied by Federal Reserve Banks or Branches on application therefor. Banking institutions generally may submit tenders fo r account of customers, provided the names of the customers are set forth in such tenders. O thers than banking institutions will not be per mitted to submit tenders except fo r their own account. Tenders will be received w ithout deposit from incorporated banks and trust companies and from responsible and recognized dealers in invest ment securities. Tenders from others m ust be accompanied by payment of 2 percent of the face amount of T reasury bills applied for, unless the tenders are accompanied by an express guaranty of payment by an incorporated bank or tru st company. Immediately a fter the closing hour, tenders will be opened at the Federal Reserve Banks and Branches, following which public announcement will be made by the T reasury D epartm ent of the amount and price range of accepted bids. Only those submitting competitive tenders will be advised of the acceptance or rejection thereof. T he Secretary of the T reasury expressly reserves the right to accept or reject any or all tenders, in whole o r in part, and his action in any such respect shall be final. Subject to these reservations, noncompetitive tenders fo r each issue fo r $200,000 or less w ithout stated price from any one bidder will be accepted in full at the average price (in three decimals) of accepted competi tive bids fo r the respective issues. Settlem ent fo r accepted tenders in accordance w ith the bids m ust be made or completed at the Federal Reserve Bank on M ay 25, 1972, in cash o r other immedi ately available funds o r in a like face amount o f T reasury bills m aturing M ay 25, 1972. Cash and exchange tenders will receive equal treatm ent. Cash adjustm ents will be made fo r differences between the par value of m aturing bills accepted in exchange and the issue price of the new bills. U nder Sections 454(b) and 1221(5) of the Internal Revenue Code of 1954, the amount o f discount at which bills issued here under are sold is considered to accrue when the bills are sold, re deemed o r otherwise disposed of, and the bills are excluded from consideration as capital assets. Accordingly, the ow ner of T reasury bills (other than life insurance companies) issued hereunder must include in his income tax return, as ordinary gain o r loss, the d if ference between the price paid fo r the bills, w hether on original issue o r on subsequent purchase, and the am ount actually received either upon sale or redemption at m aturity during the taxable year fo r which the return is made. T reasu ry D epartm ent C ircular No. 418 (cu rren t revision) and this notice prescribe the term s of the T reasu ry bills and govern the conditions o f their issue. Copies of the circular may be ob tained from any Federal Reserve B ank o r Branch. This Bank will receive tenders for both series up to 1 :30 p.m., Eastern Daylight Saving time, Monday, May 22, 1972, 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 (W eekly).” Tenders not requiring a deposit may be submitted by telegraph, subject to written confirmation; no tenders may 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 immedi ately available funds or in maturing Treasury bills. Results of the last weekly offering of Treasury bills (91-day bills to be issued May 18, 1972, representing an additional amount of bills dated February 17, 1972, maturing August 17, 1972; and 182-day bills dated May 18, 1972, maturing November 16, 1972) are shown on the reverse side of this circular. A lfred H ayes, President. Please note that the Treasury bills maturing November 24, 1972, will be 183-day bills. (o ver ) RESULTS OF LAST WEEKLY OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED MAY 18, 1972) Range of Accepted Competitive Bids 91-Day Treasury Bills Maturing August 17,1972 182-Day Treasury Bills Maturing November 16,1972 A pprox. equiv. annual rate Price Price A pprox. equiv. annual rate High . 99.080 3.640% 97.937 4.081% Low . . 99.057 3.731% 97.905 4.144% Average 99.065 3.699%* 97.918 4.118%1 a Except one tender of $160,000. 1 These rates are on a bank discount basis. The equivalent coupon issue yields are 3.79% for the 91-day bills, and 4.26% for the 182-day bills. (32 percent of the amount of 91-day bills bid for at the low price was accepted.) (94 percent of the amount of 182-day bills bid for at the low price was accepted.) Total Tenders Applied for and Accepted (By Federal Reserve Districts) 91-Day Treasury Bills Maturing August 17,1972 Accepted Applied fo r D istrict Boston ........................ .......... $ 22,985,000 182-Day Treasury Bills Maturing November 16,1972 $ 12,985,000 Applied fo r $ 12,020,000 Accepted $ 2,020,000 New York .................. .......... 3,016,585,000 2,018,585,000 2,664,220,000 1,642,320,000 P hiladelphia................ .......... 12,530,000 12,530,000 26,085,000 6,085,000 Cleveland .................... .......... 17,740,000 17,740,000 20,070,000 10,070,000 R ichm ond.................... .......... 6,895,000 6,895,000 3,040,000 3,040,000 Atlanta ........................ .......... 36,110,000 20,110,000 23,135,000 11,135,000 ...................... .......... 249,010,000 97,810,000 214,965,000 86,065,000 St. L o u is ...................... .......... 35,910,000 25,230,000 22,060,000 9,560,000 Minneapolis ................ .......... 32,600,000 20,600,000 27,400,000 6,400,000 Kansas C i t y ................ .......... 33,605,000 23,555,000 18,725,000 7,525,000 Dallas .......................... .......... 32,265,000 10,265,000 27,720,000 9,720,000 San Francisco ............ 67,875,000 33,895,000 53,485,000 6,480,000 $3,112,925,000 $1,800,420,000= Chicago T otal ................... .......... $3,564,110,000 $2,300,200,000b b Includes $172,055,000 noncompetitive tenders accepted at the average price of 99.065. c Includes $75,600,000 noncompetitive tenders accepted at the average price of 97.918.