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FEDERAL RESERVE BANK OF N E W YORK Fiscal Agent of the United States r Circular No. 7 1 3 7 1 U May 8, 1973 J O FFERIN G OF T W O SERIES OF T R E A S U R Y BILLS $2,500 ,00 0,00 0 of 91-Day Bills, Additional Amount, Series Dated February 1 5 ,1 9 7 3 , Due August 16 ,1 9 7 3 (To Be Issued May 17, 1973) $1,700,000,000 of 182-Day Bills, Dated May 17, 1973, Due November 15, 1973 T o A ll In corporated Banks and Trust Companies, and O thers Concerned, in the Second Federal R eserv e D istrict: Following is the text of a notice issued by the Treasury Department, released at 4 p.m. today: T h e Treasury Department, by this public notice, invites tenders fo r tw o series o f Treasury bills to the aggregate amount of $4,200,000,000, or thereabouts, for cash and in exchange for T rea sury bills maturing M ay 17, 1973, in the amount of $4,304,335,000, as fo llo w s : companies and from responsible and recognized dealers in invest ment securities. Tenders from others must be accompanied by payment o f 2 percent of the face amount o f Treasury bills applied for, unless the tenders are accompanied by an express guaranty of payment by an incorporated bank or trust company. 91-day bills (to maturity date) to be issued M ay 17, 1973, in the amount o f $2,500,000,000, or thereabouts, representing an additional amount o f bills dated Febru ary 15, 1973, and to mature August 16, 1973 (C U S I P N o. 912793 R Q 1 ), originally issued in the amount o f $1,802,910,000, the additional and original bills to be freely interchangeable. 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 amount and price range of accepted bids. Only those submitting competitive 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 reserva tions, noncompetitive 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 decim als) o f accepted competitive bids for the respective issues. Settlement for accepted tenders in accordance with the bids must be made or completed at the Federal Reserve Bank on M ay 17, 1973, in cash or other immediately available funds or in a like face amount o f Treasury bills maturing M ay 17, 1973. Cash and exchange tenders w ill 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. 182-day bills, for $1,700,000,000, or thereabouts, to be dated M ay 17, 1973, and to mature N ovem ber 15, 1973 ( C U S I P N o. 912793 S D 9 ). T he bills o f both series w ill be issued on a discount basis under com petitive and noncompetitive bidding as hereinafter provided, and at maturity their face amount w ill be payable without 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 (maturity va lu e). Tenders w ill be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern Daylight Saving time, M onday, M ay 14, 1973. Tenders w ill not be received at the Treasury Department, W ashington. Each tender must be for a minimum o f $10,000. Tenders over $10,000 must be in mul tiples o f $5,000. In the case o f competitive tenders the price offered must be expressed on the basis o f 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 forw arded in the special envelopes which w ill be supplied by Federal Reserve Banks or Branches on application therefor. Banking institutions generally may submit tenders for account of customers, provided the names o f the customers are set forth in such tenders. Others than banking institutions w ill not be per mitted to submit tenders except for their ow n account. Tenders will be received without deposit from incorporated banks and trust Under Sections 4 5 4 (b ) and 1221(5) o f the Internal Revenue Code o f 1954, the amount of discount at which bills issued hereunder are sold is considered to accrue when the bills are sold, redeemed or otherwise disposed of, and the bills are excluded from considera tion as capital assets. A ccordin gly, the owner o f Treasury bills (other than life insurance com panies) issued hereunder must include in his income tax return, as ordinary gain or loss, the difference between the price paid for the bills, whether on original issue o r 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. Treasury Department Circular N o. 418 (current revision) and this notice prescribe the terms of the Treasury bills and govern the conditions o f their issue. Copies o f the circular may be ob tained 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, Monday, May 14, 1973, 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 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 immediately available funds or in maturing Treasury bills. Results of the last weekly offering of Treasury bills (91-day bills to be issued May 10, 1973, representing an addi tional amount of bills dated February 8 , 1973, maturing August 9, 1973; and 182-day bills dated May 10, 1973, maturing November 8 , 1973) are shown on the reverse side of this circular. A lfred H ayes, President. (OVER) RESULTS OF L A ST W E E K L Y O FFE R IN G OF T R E A S U R Y BILLS (T W O SERIES TO BE ISSUED M A Y 10, 1973) Range of Accepted Competitive Bids 91-Day Treasury Bills Maturing August 9, 1973 182-Day Treasury Bills Maturing November 8,1973 A p p rox. equiv. annual rate P r ice P r ice A p p ro x . equiv. annual rate High .. 98.455 6 . 112% 96.758 6.413% Low .. 98.448 6.140% 96.741 6.446% Average 98.449 6.136%1 96.749 6.431%x 1 These rates are on a bank discount basis. T h e equivalent coupon issue yields are 6.32% for the 91-day bills, and 6.74% for the 182-day bills. (85 percent of the amount of 91-day bills bid for at the low price was accepted.) (72 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 9, 1973 ........................ .......... Boston A ccep ted A pplied for D istrict $ 26,495,000 182-Day Treasury Bills Maturing November 8, 1973 $ 14,395,000 Applied for $ 14,480,000 A ccepted $ 2,630,000 New Y o r k .................. .......... 3,624,825,000 2,192,730,000 Philadelphia................ .......... 14,695,000 14,670,000 25,225,000 5,095,000 Cleveland .................... .......... 25,615,000 21,770,000 34,000,000 8,800,000 R ichm ond.................... ........... 9,280,000 9,280,000 5,895,000 5,095,000 Atlanta ........................ ........... 27,915,000 13,120,000 22,525,000 10,715,000 ........................ .......... 356,970,000 122,970,000 285,470,000 98,045,000 St. Louis .................... ........... 40,235,000 25,520,000 23,380,000 19,070,000 Minneapolis .................. .......... 35,010,000 6,565,000 30,045,000 8,045,000 Kansas C it y .................. .......... 34,580,000 18,450,000 30,525,000 14,475,000 Dallas ............................ .......... 42,130,000 13,530,000 36,885,000 7,885,000 San F ra n cisco.............. .......... 137,390,000 50,650,000 194,530,000 92,720,000 Chicago T otal ...................... $4,375,140,000 $2,503,650,000a a Includes $223,415,000 noncompetitive tenders accepted at the average price o f 98.449. b Includes $105,355,000 noncompetitive tenders accepted at the average price of 96.749. 2,915,890,000 1,528,900,000 $3,618,850,000 $1,801,475,000b TREASURY DEPARTMENT Washington, D.C. STATEMENT FOR THE PRESS May 7, 1973 FOR IMMEDIATE RELEASE Treasury Announces Reduction in Weekly Issue of Bills The Treasury announced today that the amount of its weekly auction of l82-day hills will he lower by $100 million in coming weeks. amount auctioned has been $1.8 billion each week. In recent weeks the Beginning with the auction to be held on Monday, May lU, the amount auctioned will be $1.7 billion. This change has been made in recognition of the Treasury's strong cash position.
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