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FEDERAL RESERVE BANK O F N EW YORK Fiscal Agent of the United States r L C ircular No. 7926*1 Ju ly 28, 1976 J OFFERING OF TWO SERIES OF TREASURY BILLS $2,700,000,000 of 91-Day Bills, Additional Amount, Series Dated May 6, 1976, Due November 4, 1976 (To Be Issued August 5, 1976) $3,700,000,000 of 182-Day Bills, Dated August 5, 1976, Due February 3, 1977 T o A l l In c o r p o r a te d B a n k s and T r u s t C o m p a n ies, a n d O th e r s C o n c ern ed , in th e S e c o n d F e d e r a l R e s e r v e D is tr ic t: Following is the text of a notice issued by the Treasury Department, released yesterday: The Treasury Department, by this public notice, invites tenders for two series of Treasury bills to the aggregate amount of $6,400 million, or thereabouts, to be issued August 5, 1976, as fol lows : 91-day bills (to maturity date) in the amount of $2,700 million, or thereabouts, representing an additional amount of bills dated May 6, 1976, and to mature November 4, 1976 (C U SIP No. 912793 B88), originally issued in the amount of $3,601 million, the additional and original bills to be freely interchangeable. 182-day bills for $3,700 million, or thereabouts, to be dated August 5, 1976, and to mature February 3, 1977 (C U SIP No. 912793 E44). The bills will be issued for cash and in exchange for Treasury bills maturing August 5, 1976, outstanding in the amount of $6,407 million, of which Government accounts and Federal Reserve Banks, for themselves and as agents of foreign and international monetary authorities, presently hold $2,668 million. 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, August 2, 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 \ o r k 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 each issue 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 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 August 5, 1976, in cash or other immedi ately available funds or in a like face amount of Treasury bills maturing August 5, 1976. 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 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. 1 reasury 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. This Bank will receive tenders for both series up to 1 :30 p.m., Eastern Daylight Saving time, Monday, August 2, 1976, 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. P a y m e n t fo r T r e a s u r y b ills c a n n o t be m a d e b y c r e d it th ro u g h th e T r e a s u r y T a x a n d L o a n A c c o u n t. S e t tle m e n t m u s t be m a d e in cash o r o th e r im m e d ia te ly a va ila b le fu n d s o r in m a tu r in g T r e a s u r y bills. R esults of the last weekly offering of T re a su ry bills (91-day bills to be issued Ju ly 29, 1976, representing an addi tional am ount of bills dated A pril 29, 1976, m atu rin g O ctober 28, 1976; and 182-day bills dated Ju ly 29, 1976, m aturing Ja n u a ry 27, 1977) are shown on the reverse side of this circular. r32] P aul A. V olcker, President. ( over) RESULTS OF LAST WEEKLY OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED JULY 29, 1976) Range of Accepted Competitive Bids 9 1- D a y T r e a s u r y B ills M a t u r i n g O c t o b e r 2 8 ,19 7 6 Price 98.697 98.684 98.687 H ig h ................................................... Low ..................................................... A verage ............................................ Discount Rate 5.155% 5.206% 5.194% 18 2 - D a y T r e a s u r y B i l l s M a t u r i n g J a n u a r y 27 , 1977 Investment Rate1 5.30% 5.35% 5.34% Price 97.234a 97.217 97.221 Discount Rate 5.471% 5.505% 5.497% Investment Rate* 5.70% 5.74% 5.73% 1 Equivalent coupon-issue yield. a Excepting one tender of $3,000,000. (1 p ercent of the am ount of 91-day bills bid for at the low price was accepted.) (96 percent of the am ount of 182-day bills bid for at the low price was accepted.) Total Tenders Received and Accepted (By Federal Reserve District) 9 1- D a y T r e a s u r y B ills M a t u r i n g O c t o b e r 28 , 1976 District Boston......................... ............ New Y o rk ...................... ............ Philadelphia ................ ............ Cleveland ................... ............ Richmond ................... ........... Atlanta ....................... ............ Chicago....................... ............ St. Louis..................... ............ Minneapolis ................ ............ Kansas City ................ ............ Dallas ......................... ............ San Francisco.............. ..... T otals ................ ........... Received $ 38,235,000 3,713,810,000 35,985,000 36,200,000 17,830,000 21,770,000 409,435,000 47,575,000 40,565,000 36,930,000 43,760,000 302,045,000 $4,744,140,000 Accepted Received $ 29,255,000 2,095,540,000 35,985,000 35,360,000 17,830,000 21,280,000 112,535,000 26,605,000 17,605,000 29,830,000 17,770,000 61,445,000 $ $2,501,040,000b $6,396,990,000 • Includes $320,355,000 noncompetitive tenders from the public. > c Includes $158,315,000 noncompetitive tenders from the public. 18 2 - D a y T r e a s u r y B i l l s M a t u r i n g J a n u a r y 27 , 1977 22,025,000 5,095,275,000 35,635,000 164,255,000 62,810,000 14,560,000 516,390,000 44,260,000 62,390,000 27,720,000 38,210,000 313,460,000 Accepted $ 18,025,000 3,090,675,000 10,635,000 64,255,000 48,310,000 14,560,000 95,890,000 23,140,000 42,230,000 23,720,000 16,210,000 157,860,000 $3,605,510,000c