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FED E R A L R ESER VE BANK OF NEW YORK Fiscal A g e n t of the United States [ Circular No. 7 4 0 0 1 May 28, 1974 J OFFERING OF TWO SERIES OF TREASURY BILLS $2,600,000,000 of 91-Day Bills, Additional Amount, Series Dated March 7, 1974, Due September 5, 1974 (To Be Issued June 6, 1974) $1,900,000,000 of 182-Day Bills, Dated June 6, 1974, Due December 5, 1974 T o A ll Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal R eserve D istrict: F ollow in g is the text of a notice issued by the T reasury Department, released at 4 p.m. to d a y : The Treasury Department, by this public notice, invites tenders for two series of Treasury bills to the aggregate amount of $4,500,000,000, or thereabouts, to be issued June 6, 1974, as fo llo w s: 91-day bills (to maturity date) in the amount of $2,600,000,000, or thereabouts, representing an additional amount of bills dated March 7, 1974, and to mature September 5, 1974 ( C U S I P No. 912793 U N 4 ) , originally issued in the amount of $1,804,950,000, the additional and original bills to be freely interchangeable. 182-day bills, for $1,900,000,000, or thereabouts, to be dated June 6, 1974, and to mature December 5, 1974 ( C U S I P No. 912793 V B 9 ) . The bills will be issued for cash and in exchange for Treasury bills maturing June 6, 1974, outstanding in the amount of $4,301,440,000, of which Government accounts and Federal Reserve Banks, for themselves and as agents of foreign and international monetary authorities, presently hold $2,423,245,000. These accounts may exchange bills they hold for the bills now being offered at the average prices of accepted tenders. The bills of both series will be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided, and at maturity their face amount will 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 value). Tenders will be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern Daylight Saving time, Monday, June 3, 1974. Tenders will not be received at the Treasury Department, Washington. Each tender must be for a minimum of $10,000. Tenders over $10,000 must be in multiples of $5,000. In the case of competitive tenders the price offered must be expressed on the basis of 100, with not more than three decimals, e.g., 99.925. Fractions may not be used. It is urged that tenders be made on the printed forms and forwarded in the special envelopes which will be supplied by Federal Reserve Banks or Branches on application therefor. Banking institutions and dealers who make primary markets in Government securities and report daily to the Federal Reserve Bank of New Y ork their positions with respect to Government securities and borrowings thereon may submit tenders for account of customers provided the names of the customers are set forth in such tenders. Others will not be permitted to submit tenders except for their own accounts. Tenders will be received without deposit from incorporated banks and trust companies and from responsible and recognized dealers in investment securities. Tenders from others must be accompanied by payment of 2 percent of the face amount of Treasury bills applied for, unless the tenders are accompanied by an express guaranty of payment by an incorporated bank or trust com pany. Immediately after the closing hour, tenders will be opened at the Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price range of accepted bids. Only those submitting competitive tenders will be advised of the acceptance or rejection thereof. The Secretary of the Treasury expressly reserves the right to accept or reject any or all tenders, in whole or in part, and his action in any such respect shall be final. Subject to these reservations, 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 decimals) of accepted competi tive 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 June 6, 1974, in cash or other immedi ately available funds or in a like face amount of Treasury bills maturing June 6, 1974. Cash and exchange tenders will receive equal treatment. Cash adjustments will be made for differences between the par value of maturing bills accepted in exchange and the issue price of the new bills. Under Sections 4 5 4 (b ) and 1221(5) of the Internal Revenue Code of 1954, the amount of discount at which bills issued here under are sold is considered to accrue when the bills are sold, redeemed or otherwise disposed of, and the bills are excluded from consideration as capital assets. Accordingly, the owner of Treasury bills (other than life insurance companies) 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 or 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 this notice prescribe the terms of the conditions of their issue. Copies from any Federal Reserve Bank or No. 418 (current revision) and the Treasury bills and govern of the circular may be obtained Branch. T his Bank will receive tenders for both series up to 1 :30 p.m., Eastern Daylight Saving time, M onday, June 3, 1974, at the Securities Department of its H ead Office and at its B uffalo Branch. Tender form s for the respective series are enclosed. Please use the appropriate form s to submit tenders and return them in the enclosed envelope marked “ T ender for T reasury B ills.” Tenders not requiring a deposit may be submitted by telegraph, subject to written con firm ation ; 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 M ay 30, 1974, representing an additional amount of bills dated February 28, 1974, maturing August 29, 1974 ; and 183-day bills dated M ay 30, 1974, maturing November 29, 1974) are shown on the reverse side of this circular. A lfred H ayes, President. ( over) R E S U L T S O F L A S T W E E K L Y O F F E R I N G O F T R E A S U R Y BILLS ( T W O S E R I E S T O B E I S S U E D M A Y 30, 1974) Range of Accepted Competitive Bids 91 -Day Treasury Bills Maturing August 29,1974 H ig h .............................. .................. L o w ................................ .................. A verag e ....................... .................. Price A pprox. equiv. annual rate 98.04 l a 97.957 7.750% 8.0 8 2 % 97.982 7.983 % x 183-Day Treasury Bills Maturing N ovem ber 29,1974 A pprox. equiv. annual rate Price 95.888b 95.804 95.829 a Excepting one tender of $5,000,000. 8.0 8 9 % 8 .254% 8 .2 0 5 % ! b Excepting five tenders totaling $2,45 1 These rates are on a bank discount basis. 183-day bills. The equivalent coupon issue yields are 8 .26 % for the 91-day bills, and 8.68% fc (51 percent o f the amount o f 91-day bills bid for at the low price was accepted.) (7 0 percent of the amount of 183-day bills bid for at the low price was accepted.) Total Tenders Applied for and Accepted ( B y Federal Reserve District) 183-Day Treasury Bills Maturing N ovem ber 29,1974 91-Day Treasury Bills Maturing August 29,1974 District Applied for B oston ........................... ............ $ 42,195,000 Applied for Accepted $ 32,195,000 $ 25,155,000 Accepted $ 13,155,000 N e w Y o r k ..................... ........... 3,108,015,000 2,137.765,000 2,966,800.000 1,621,790,000 P h ila d e lp h ia .................. ........... 22,930.000 22,905,000 10,940,000 10,890,000 Cleveland ....................... ........... 52,370,000 38,025,000 47,515,000 26,520,000 R ic h m o n d ....................... ............ 32,300,000 22,350,000 19,370,000 14,445,000 A t l a n t a ........................... ............ 28,855,000 28,555,000 23,455,000 23,055,000 ......................... ........... 189,020,000 156,530,000 161,275,000 66,475,000 St. L ouis ....................... ........... 42,790,000 26,790,000 41,800,000 19,800.000 M inneapolis .................. ............ 15,555,000 15,555,000 1 2 ,2 0 0 ,0 0 0 1 2 ,2 0 0 .0 0 0 Kansas C i t y .................. ........... 30,400,000 30,400,000 33,870,000 33,870,000 Dallas .............................. ........... 16,605,000 16,605,000 13,525,000 10,565,000 San F r a n c i s c o .............. ............ 137,520,000 72,510,000 115,170,000 47,360,000 ........... $3,718,555,000 Chicago T otal .................... $2,600,185,000° c Includes $364,095,000 noncompetitive tenders accepted at the average price. d Includes $221,620,000 noncompetitive tenders accepted at the average price. $3,471,075,000 $ 1,900,125,000d