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FEDERAL RESERVE BANK OF NEW YORK Fiscal Agent of the United States r Circular No. 7808*1 L January 29, 1976 4 Offering of $2,160,000,000 of 364-Day Treasury Bills Dated February 10, 1976 Due February 8, 1977 To Att 7ncor/?orafod RazzAs' azzd rrzz^t Conz^azziey, azzet OtAer^ Concerned, fn tAe Cecond Federal Reserve District; Following is the text of a notice issued today by the Treasury Department: The Department of the Treasury, by this public notice, invites tenders for 364-day Treasury bills to be dated February 10, 1976, and to mature February 8, 1977 (C U SIP No. 912793 C95). The bills will be issued for cash and in exchange for Treasury bills maturing February 10, 1976. Tenders in the amount of $2,160 million, or thereabouts, will be accepted from the public, which holds $1,160 million of the maturing bills. Additional amounts of the bills may be issued at the average price of accepted tenders to Government accounts and Federal Reserve Banks, for themselves and as agents of foreign and inter national monetary authorities, which hold $943 million of the ma turing bills. The bills 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 bookentry form to designated bidders. Tenders will be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern Standard time, Wednesday, February 4, 1976. 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 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 company. 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 $500,000 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. Settlement for accepted tenders in accordance with the bids must be made or completed at the Federal Reserve Bank on February 10, 1976, in cash or other immediately available funds or in a like face amount of Treasury bills maturing February 10, 1976. Cash and exchange tenders will receive equal treatment. Cash adjust ments 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 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, re deemed 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 dif ference 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 prescibe the terms of the Treasury bills and govern the conditions of their issue. Copies of the circular may be ob tained from any Federal Reserve Bank or Branch. This Bank will receive tenders up to 1 :30 p.m., Eastern Standard time, Wednesday, February 4, 1976 at the Securities Department of its Head Office and at its Buffalo Branch. Please use the form on the reverse side of this notice to submit a tender and return it 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 jkzr tAe Prea^zzry AiiP cannot Ae wade Ay credit tArozzz/A t/ze Prea.yz;ry Pa,v and Loan ^dccozznt. Jettiewent nznjt Ae made in cajA or otAer immediately avai/aAie fzzndy or in nzatnrznz) Prea^zzry Adiy. PA U L A. VoLCKER, President. (O V E R )
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