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FEDERAL RESERVE BANK OF NEW YORK Fiscal Agent of the United States r Circular No. 7 4 7 0~1 L October 1, 1974 J OFFERING OF TWO SERIES OF TREASURY BILLS $2,700,000,000 of 91-Day Bills, Additional Amount, Series Dated July 11, 1974, Due January 9, 1975 (To Be Issued October 10, 1974) $2,000,000,000 of 182-Day Bills, Dated October 10, 1974, Due April 10, 1975 To All Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve District: F ollow in g is the text of a notice issued by the Treasury Department, released at 4 p.m. tod a y : The Treasury Department, by this public notice, invites tenders for two series of Treasury bills to the aggregate amount of $4,700,000,000, or thereabouts, to be issued October 10, 1974, as follows: 91-day bills (to maturity date) in the amount of $2,700,000,000, or thereabouts, representing an additional amount of bills dated July 11, 1974, and to mature Janu ary 9, 1975 (C U SIP No. 912793 VQ6), originally issued in the amount of $1,903,625,000, the additional and origi nal bills to be freely interchangeable. 182-day bills, for $2,000,000,000, or thereabouts, to be dated October 10, 1974, and to mature April 10, 1975 (C U SIP No. 912793 W D4). The bills will be issued for cash and in exchange for Treasury bills maturing October 10, 1974, outstanding in the amount of $4,504,315,000, of which Government accounts and Federal Reserve Banks, for themselves and as agents of foreign and international monetary authorities, presently hold $2,401,130,000. 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 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. Tenders will be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern Daylight Saving time, Monday, October 7, 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 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 York 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 account. 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 October 10, 1974, in cash or other im mediately available funds or in a like face amount of Treasury bills maturing October 10, 1974. Cash and exchange tenders will receive equal treatment. Cash adjustments will be made for differ ences between the par value of maturing bills accepted in exchange and the issue price of the new bills. Under Sections 454(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 No. 418 (current revision) and this notice prescribe the terms of the Treasury bills and govern the conditions of their issue. Copies of the circular may be obtained from any Federal Reserve Bank or Branch. T his Bank will receive tenders for both series up to 1 :30 p.m., Eastern Daylight Saving time, M on day, O ctober 7, 1974, at the Securities Department o f its H ead Office an d at its B uffalo Branch. T ender form s fo r 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 Treasury B ills.” Tenders not requiring a deposit may be submitted by telegraph, subject to written confirm 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 October 3, 1974, representing an additional amount o f bills dated July 5, 1974, maturing January 2, 1975; and 182-day bills dated October 3, 1974, maturing April 3, 1975) are shown on the reverse side of this circular. A l fr e d H a y e s , President. ( over) RESULTS OF LAST W EEK LY OFFERING OF TREASURY BILLS (T W O S E R IE S T O B E IS S U E D O C T O B E R 3, 1 9 7 4 ) Range of Accepted Competitive Bids 91 -Day Treasury Bills Maturing January 2 , 19 75 Price ................................. ................. L o w .................................... ................. A verage ........................... ................. Approx. equiv. annual rate Price 6 .6 5 0 % 6 .3 8 5 % 1 98.386 Approx. equiv. annual rate 96.45 l a 96.145 96.239 6 .1 0 0 % 98.458 98.319 H igh 18 2 -Day Treasury Bills Maturing April 3 , 1975 7.0 20 % 7.6 25% 7 .439 % 1 a Excepting one tender of $1,475,000. 1 These rates are on a bank discount basis. The equivalent coupon issue yields are 6.58% for the 91-day bills, and 7.84% for the 182-day bills. (81 percent o f the amount o f 91 -day bills bid fo r at the low price was accepted.) (29 percent o f the amount of 182-day bills bid for at the low price was accepted.) Total Tenders Applied for and Accepted (By Federal Reserve District) 9 1 -Day Treasury Bills Maturing January 2 , 19 75 District Applied for 18 2 -Day Treasury Bills Maturing April 3 , 1975 Accepted Accepted Applied for 16,935,000 27,550,000 2,179,045,000 37,010,000 Cleveland ........................ .............. R ichm ond .................................... Atlanta ............................. ............. 40,065,000 40,065,000 26,935,000 2,140,855,000 51,675,000 33,035,000 44,365,000 28,925,000 34,365,000 28,625,000 37,690,000 31,465,000 C hicago .......................... ............. St. L ouis ........................ ............. M inneapolis ................... .............. 122,745,000 36,175,000 158,820,000 40,910,000 14,030,000 46,795,000 34,985,000 14,030,000 18,050,000 18,050,000 Kansas City ................... .............. Dallas ............................... .............. 27,205,000 20,615,000 27,205,000 20,615,000 30,175,000 30,165,000 32,335,000 32,295,000 San Francisco ............... ............. 149,860,000 109,805,000 166,070,000 116,020,000 ..................... ............. $3,518,060,000 T ota l $ 37,550,000 $ $2,600,095,000b b Includes $365,450,000 noncompetitive tenders accepted at the average price, c Includes $306,630,000 noncompetitive tenders accepted at the average price. $ $ 2,959,515,000 37,010,000 B oston ............................ .............. N ew Y o rk .................................... Philadelphia ................. ............. $2,768,015,000 1,439,295,000 49,175,000 33,035,000 24,130,000 31,265,000 72,810,000 36,900,000 $ 1 ,900,075,000