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FED ER AL RESERVE BANK O F N EW YORK Fiscal Agent of the United States Circular No. 7 6 1 8 *1 April 29, 1975 J [ OFFERING OF TWO SERIES OF TREASURY BILLS $2,800,000,000 of 91-Day Bills, Additional Amount, Series Dated February 6, 1975, Due August 7, 1975 (To Be Issued May 8, 1975) $2,800,000,000 of 182-Day Bills, Dated May 8, 1975, Due November 6, 1975 To A ll Incorporated Banks and Trust 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. to d ay : T en d ers will be received a t F ed eral R eserve B anks and B ranches up to the closing hour, one-th irty p.m., E a s te rn D aylight S aving tim e, M onday, M ay 5, 1975. T en d ers will n o t be re ceived a t the T re a su ry D epartm ent, W ashington. E ac h ten der m ust be fo r a m inim um of $10,000. T en d ers over $10,000 m ust be in m ul tiples of $5,000. In the case of com petitive tenders the price offered m ust be expressed on the basis of 100, w ith not m ore than three decim als, e.g., 99.925. F ra c tio n s m ay not be used. I t is urged th a t tenders be m ade on the printed form s and forw ard ed in the special envelopes w hich will be supplied by F ed eral R eserve B anks o r B ranches on application therefor. of custom ers, provided the nam es of the custom ers a re set fo rth in such tenders. O th e rs will not be perm itted to subm it tenders except for th eir ow n account. T en d ers w ill be received w ith o u t deposit from incorporated banks an d tru s t com panies and fro m responsible and recognized dealers in investm ent securities. T en d ers fro m o th ers m ust be accom panied by paym ent of 2 percent of the face am ount of T re a su ry bills applied for, unless the tenders a re accom panied by an e xpress g u a ran ty of paym ent by an inco rp o rated bank o r tr u s t com pany. Im m ediately a fte r the closing hour, tenders w ill be opened a t the F ederal R eserve B anks and B ranches, follow ing w hich public announcem ent will be m ade by the T re a su ry D e p artm en t of the am ount and price range of accepted bids. O nly those subm itting com petitive tenders will be advised of the acceptance o r rejection thereof. T he S ecretary of the T re a su ry e xpressly reserves the rig h t to accept or re je ct any o r all tenders, in w hole o r in p a rt, and his action in any such respect shall be final. S u b ject to these reservations, noncom petitive tenders for each issue fo r $200,000 or less w ithout stated price from any one bidder will be accepted in full a t the average price (in three decim als) of accepted com peti tive bids for the respective issues. S ettlem ent fo r accepted tenders in accordance w ith the bids m u st be m ade o r com pleted a t the F ed eral R eserve B ank on M ay 8, 1975, in cash o r o th er im m ediately available funds o r in a like face am ount of T re a su ry bills m atu rin g M ay 8, 1975. C ash and exchange ten d ers w ill receive equal treatm ent. C ash ad ju stm en ts will be m ade fo r d iffer ences betw een the p a r value of m atu rin g bills accepted in exchange and the issue price of the new bills. U n d er Sections 4 5 4 (b ) and 1221(5) of the In te rn a l R evenue Code of 1954, the am ount of discount a t w hich bills issued h e re under are sold is considered to accrue w hen the bills a re sold, redeem ed or otherw ise disposed of, and the bills are excluded from consideration as capital assets. A ccordingly, the ow ner of T re a su ry bills (o th er th an life insurance com panies) issued heueunder m ust include in his income ta x re tu rn , as o rd in ary g ain o r loss, the difference betw een the price paid fo r the bills, w h eth er on original issue o r on subsequent purchase, and the am ount actually received either upon sale o r redem ption a t m atu rity d u rin g the taxable y ear fo r w hich the re tu rn is made. B anking institutions and dealers w ho m ake prim ary m ark e ts in G overnm ent securities and re p o rt daily to the F ed eral R eserve B ank of N ew Y ork th eir positions w ith respect to G overnm ent securities and borrow ings thereon m ay subm it tenders fo r account T re a su ry D e p artm en t C ircu lar N o. 418 (c u rre n t revision) and this notice prescribe the term s of the T re a su ry bills and govern the conditions of th eir issue. Copies of the c irc u la r m ay be obtained from any F ed eral R eserve B ank o r B ranch. T he T re a su ry D epartm ent, by this public notice, invites tenders for tw o series of T re a su ry bills to the ag g reg a te am ount of $5,600,000,000, o r thereabouts, to be issued M ay 8, 1975, as fo llo w s: 91-day bills (to m atu rity d a te ) in the am ount of $2,800,000,000, o r thereabouts, representing an additional am ount of bills dated F e b ru a ry 6, 1975, and to m atu re A u g u st 7, 1975 ( C U S I P N o. 912793 X H 4 ), originally issued in the am ount of $2,400,740,000, the additional and original bills to be freely interchangeable. 182-day bills, for $2,800,000,000, o r thereabouts, to be dated M ay 8, 1975, and to m atu re N ovem ber 6, 1975 ( C U S I P No. 912793 X W 1 ) . T he bills will be issued fo r cash and in exchange for T re a su ry bills m atu rin g M ay 8, 1975, outstanding in the am ount of $4,802,370,000, of w hich G overnm ent accounts and F ed eral R eserve Banks, for them selves and as agents of foreign and international m onetary authorities, presently hold $2,624,305,000. T hese accounts m ay exchange bills they hold fo r the bills now being offered a t the average prices of accepted tenders. T he bills o f both series will be issued on a discount basis under com petitive and noncom petitive bidding as hereinafter provided, and a t m atu rity th eir face am ount will be payable w ithout interest. T hey will be issued in b e are r form in denom inations of $10,000, $15,000, $50,000, $100,000, $500,000 and $1,000,000 (m a tu rity value) and in book-entry form to designated bidders. This Bank will receive tenders for both series up to 1:30 p.m., Eastern Daylight Saving time, Monday, May 5, 1975, 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 con firmation; 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 1, 1975, representing an additional amount of bills dated January 30, 1975, m aturing July 31, 1975; and 182-day bills dated May 1, 1975, maturing October 30, 1975) are shown on the reverse side of this circular. [19] A lfred H ayes, President. ( ov er ) RESULTS OF LAST WEEKLY OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED MAY 1, 1975) Range of Accepted Competitive Bids 91-Day Treasury Bills Maturing July 3 1, 1975 Price High ............................. .................. Low ............................... .................. A v e rag e......................... .................. 98.570 98.550 98.555 182-Day Treasury Bills Maturing October 30, 1975 Discount Rate Investment R ate 1 5.657% 5,736% 5.716% 5.83% 5.92% 5.90% Price 96.900b 96.878 96.887 1 E q u iv a len t coupon issue yield. a E x ce p tin g one tender of $600,000. Discount Rate Investment R ate 1 6.132% 6.175% 6.158% 6.43% 6.48% 6.46% b E x ce p tin g tw o tenders to ta lin g $30,000. (29 percent of the amount of 91-day bills bid for at the low price was accepted.) (41 percent of the amount of 182-day bills bid for at the low price was accepted.) Total Tenders Received and Accepted (By Federal Reserve District) 91-Day Treasury Bills Maturing July 31, 1975 D istrict Received, Boston ........................... ............ New York .................... ............ P h ilad elp h ia.................. ............ Cleveland ....................... ............ R ich m o n d ....................... ............ A tlanta ........................... ............ C hicago........................... ............ St. Louis ....................... ............ Minneapolis .................. ............ Kansas C ity .................. ............ Dallas ............................. ............ San Francisco .............. ............ T otal ............................ ............ $ 72,475,000 3,528,975,000 28,240,000 53,985,000 26,475,000 38,040,000 313,625,000 40,065,000 15,280,000 41,230,000 33,010,000 231,175,000 $4,422,575,000 Received Accepted $ 29,625,000 2,255,720,000 27,630,000 38,985,000 20,225,000 37,220,000 112,815,000 30,010,000 10,930,000 33,385,000 20,300,000 83,615,000 $2,700,460,000° c Includes $369,390,000 noncom petitive tenders from the public, d Includes $151,835,000 noncom petitive tenders from the public. 182-Day Treasury Bills Maturing October 30, 1975 $ 29,770,000 4,399,590,000 58,495,000 149,900,000 12,865,000 35,830,000 311,235,000 26,445,000 37,710,000 21,710,000 14,975,000 379,390,000 $5,477,915,000 Accepted $ 7,535,000 2,514,910,000 8,495,000 20,380,000 10,065,000 12,640,000 34,310,000 10,145,000 3,710,000 15,610,000 7,175,000 55,165,000 $2,700,140,000d