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FEDERAL RESERVE BANK OF NEW YORK Fiscal Agen t of the United States [ Circular No. 7442 August 20, 1974 1 J OFFERING OF TW O SERIES OF TREASURY BILLS $2,800,000,000 of 92-Day Bills, Additional Amount, Series Dated May 30,1974, Due November 2 9 ,1 9 7 4 (To Be Issued August 29, 1974) $2,000,000,000 of 182-Day Bills, Dated August 29,1974, Due February 27 ,1 9 7 5 T o A ll Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal R eserv e D istrict: F ollow in g is the text o f a notice issued by the Treasury Department, released at 4 p.m. to d a y : The Treasury Department, by this public notice, invites ten ders for two series of Treasury bills to the aggregate amount of $4,800,000,000, or thereabouts, to be issued August 29, 1974, as follow s: 92-day bills (to maturity date) in the amount of $2,800,000,000, or thereabouts, representing an additional amount of bills dated M ay 30, 1974, and to mature November 29, 1974 ( C U S I P N o. 912793 V A 1 ) , originally issued in the amount of $1,902,570,000, the additional and original bills to be freely interchangeable. 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 account. Tenders will be received without de posit from incorporated banks and trust companies and from respon sible 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 accom panied by an express guaranty of payment by an incorporated bank or trust company. 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 in denominations of $10,000, $15,000, $50,000, $100,000, $500,000 and $1,000,000 (maturity value) and in book-entry form to designated bidders. 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 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 decimals) of 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 August 29, 1974, in cash or other immediately available funds or in a like face amount of Treasury bills maturing August 29, 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. Tenders will be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern Daylight Saving time, Monday, August 26, 1974. Tenders will not be re ceived at the Treasury Department, Washington. Each tender must be for a minimum of $10,000. Tenders over $10,000 must be in mul tiples 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 de cimals, e.g., 99.925. Fractions may not be used. It is urged that ten ders 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. Under Sections 4 5 4 (b ) and 1 22 1 (5 ) of the Internal Revenue Code of 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. 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. 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 w-ith respect to Government securities and borrowings thereon may submit tenders for account Treasury Department Circular this notice prescribe the terms of the conditions of their issue. Copies from any Federal Reserve Bank or 182-day bills, for $2,000,000,000, or thereabouts, to be dated August 29, 1974, and to mature February 27, 1975 ( C U S I P N o. 912793 V X 1 ) . The bills will be issued for cash and in exchange for Treasury bills maturing August 29, 1974, outstanding in the amount of $4,406,125,000, of which Government accounts and Federal Reserve Banks, for themselves and as agents of foreign and international monetary authorities, presently hold $2,540,175,000. These accounts may exchange bills they hold for the bills now being offered at the average prices of accepted tenders. No. 418 (current revision) and the Treasury bills and govern of the circular may be obtained Branch. T his Bank will receive tenders fo r both series up to 1 :30 p.m ., Eastern Daylight Saving time, M onday, A ugu st 26, 1974, at the Securities Department of its H ead Office and at its Buffalo Branch. T end er 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.” T enders not requiring a deposit may be submitted by telegraph, subject to written confirm ation; no tenders may be submitted b y 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 T reasury bills (9 1 -day bills to be issued A ugu st 22, 1974, representing an additional amount of bills dated M ay 23, 1974, maturing N ovem ber 21, 1974; and 182-day bills dated A ugust 22, 1974, maturing February 20, 1975) are shown on the reverse side o f this circular. A lfred H ayes, President. Please note that the Treasury bills maturing N ovem ber 2 9 ,1 9 7 4 w ill be 92-day bills. (o v er) RESULTS OF LAST W EEK LY OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED AUGUST 22, 1974) Range of Accepted Competitive Bids 91-Day Treasury Bills Maturing N ovem ber 21,1974 182-Day Treasury Bills Maturing February 20,1975 A p p rox. equiv. annual rate P r ice P rice A p p ro x . equiv. annual rate 97.794a 8 .7 2 7 % 95.561b 8.7 8 0 % L o w ..................................... .............. 97.750 8 .9 0 1 % 95.467 8 .9 6 6% ............................ .............. 97.764 8 .8 4 6 % 1 95.501 8 .8 9 9 % x ................................... .............. H ig h A verag e b Excepting 1 tender o f $395,000. a E xcepting 1 tender o f $200,000. 1 These rates are on a bank discount basis. The equivalent coupon issue yields are 9.17% for the 91-day bills, and 9.45% for the 182-day bills. (9 percent o f the amount o f 91-day bills bid for at the low price was accepted.) (1 percent o f the amount o f 182-day bills bid for at the low price was accepted.) Total Tenders Applied for and Accepted (By Federal Reserve District) 91-Day Treasury Bills Maturing N ovem ber 21,1974 A pplied fo r D istrict B oston ............................ ............ $ 49,770,000 N ew Y o r k ..................... ............ 3,093,890,000 182-Day Treasury Bills Maturing February 20,1975 A ccep ted $ 39,770,000 2,184,955,000 A pplied for $ 15,530,000 2,389,435,000 A ccep ted $ 15,530,000 1,645,485,000 ................ ............ 35,695,000 35,650,000 13,400,000 13,400,000 Cleveland ....................... ............ 59,525,000 47,145,000 48,305,000 32,785,000 Philadelphia ................................. 62,165,000 42,665,000 42,795,000 26,295,000 Atlanta .......................... ........... 39,895,000 35,405,000 24,895,000 22,895,000 C hicago ........................... ........... 233,995,000 158,500,000 224,200,000 94,300,000 St. L ou is ....................... ............ 40,015,000 31,630,000 24,550,000 21,550,000 R ich m on d ................ ............ 12,200,000 12,200,000 8,305,000 8,305,000 Kansas C i t y ................................ 46,730,000 45,035,000 23,220,000 22,920,000 .............................. ........... 32,895,000 21,460,000 29,880,000 18,880,000 San F r a n c i s c o ................ ........... 222,300,000 145,755,000 139,755,000 77,755,000 ........................ ........... $3,929,075,000 M inneapolis Dallas T otal $2,800,170,000° c Includes $475,595,000 noncompetitive tenders accepted at the average price. d Includes $247,870,000 noncompetitive tenders accepted at the average price. $2,984,270,000 $2,000,100,000d
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