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FE D E R A L R ESER VE B AN K O F N E W YORK Fiscal Agent of the United States No. 83781 [ Circular June 28, 1978 J OFFERING OF TWO SERIES OF TREASURY BILLS $2,300,000,000 of 91-Day Bills, Additional Amount, Series Dated April 6, 1978, Due October 5, 1978 (To Be Issued July 6, 1978) $3,400,000,000 of 182-Day Bills, Dated July 6, 1978, Due January 4, 1979 T o A l l I n c o r p o r a te d B a n k s a n d T r u s t C o m p a n ie s , a n d O th e r s C o n c e r n e d , in th e S e c o n d F e d e r a l R e s e r v e D i s t r i c t : Following is the text of a notice issued by the Treasury Department, released yesterday: T h e D e p artm en t of the T re a su ry , by this public notice, invites tenders fo r tw o series of T re a su ry bills to ta lin g ap proxim ately $5,700 m illion, to be issued Ju ly 6, 1978. T h is offering will not provide new cash fo r the T re a su ry as the m atu rin g bills are o u t standin g in the am ount of $5,707 m illion. T he tw o series offered are as fo llo w s : 91-day bills (to m atu rity d a te ) fo r a p proxim ately $2,300 m illion, re p re se n tin g an additional am ount of bills dated A pril 6, 1978, and to m atu re O ctober 5, 1978 ( C U S I P N o. 912793 T 6 3 ), originally issued in the am ount of $3,406 m illion, the additional and original bills to be freely interchangeable. 182-day bills for ap p ro x im ately $3,400 m illion to be dated Ju ly 6, 1978, and to m atu re J a n u a ry 4, 1979 ( C U S I P No. 912793 W 2 8 ). B oth series of bills will be issued fo r cash and in exchange for T re a su ry bills m atu rin g Ju ly 6, 1978. F ed eral R eserve B anks, for them selves and as agents of foreign and intern atio n al m onetary au th o rities, presently hold $3,514 m illion of the m atu rin g bills. T hese accounts m ay exchange bills they hold fo r the bills now being offered a t the w eighted average prices of accepted com peti tive tenders. T h e bills will be issued on a discount basis under com petitive and noncom petitive bidding, and a t m atu rity th eir p a r am ount w ill be payable w ith o u t interest. E x ce p t fo r definitive bills in the $100,000 denom ination, w hich w ill be available only to investors w ho a re able to show th a t they a re required by law o r regulation to hold securities in physical form , both series of bills will be issued e n tirely in b o ok-entry form in a m inim um am ount of $10,000 and in any hig h er $5,000 m ultiple, on the records e ith e r of the F ed eral R eserve B anks and B ranches, o r of the D e p artm en t of the T rea su ry . T en d e rs will be received a t F e d e ral R eserve B anks and B ranches and a t the B u reau of the Public D ebt, W ashington, D. C. 20226, ut> to 1 :30 p.m., E a s te rn D ay lig h t S aving tim e, M onday, Ju ly 3, 1978. F o rm P D 4 6 3 2 -2 (fo r 26-w eek series) o r F o rm P D 4632-3 (fo r 13-week series) should be used to subm it tenders fo r bills to be m aintained on the book-entry records of the D ep artm en t of the T rea su ry . E ac h tender m ust be for a m inim um of $10,000. T en d ers over $10,000 m ust be in m ultiples 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 th an th ree decim als, e.g., 99.925. F ra c tio n s m ay not be used. B a nking institutions and dealers w ho m ake prim ary m ark ets in G overnm ent securities and re p o rt daily to the F ed eral R eserve B ank of N ew Y o rk th eir positions in and b o rrow ings on such securities m ay subm it tenders fo r account of custom ers, if the nam es of the custom ers and the am ount fo r each custom er are furnished. O th e rs are only perm itted to subm it tenders for their ow n account. P ay m en t fo r the full p a r am ount of the bills applied for m ust accom pany all tenders subm itted for bills to be m aintained on the book-entry records of the D e p artm en t of the T rea su ry . A cash a d ju stm e n t will be m ade on all accepted tenders fo r the difference betw een the p a r paym ent subm itted and the actual issue price as determ ined in the auction. N o deposit need accom pany tenders from incorporated banks and tru st com panies and from responsible and recognized dealers in investm ent securities fo r bills to be m aintained on the book-entry records of F e d e ral R eserve B anks and B ranches, o r fo r bills issued in b e are r form , w here authorized. A deposit of 2 percent of the par am ount of the bills applied fo r m u st accom pany tenders fo r such bills from others, unless an ex p ress g u a ran ty of paym ent by an incorporated bank o r tru s t com pany accom panies the tenders. P ublic announcem ent will be m ade by the D ep artm en t of the T re a su ry of the am ount and price ran g e of accepted bids. C om peti tive bidders will be advised of the acceptance o r rejection of their tenders. T he S e c retary of the T re a su ry e xpressly reserves the rig h t to accept o r re je c t any o r all tenders, in whole o r in part, and the S e c re ta ry ’s action shall be final. S u b ject to these reservations, noncom petitive tenders fo r each issue for $500,000 or less w ithout stated price from any one bidder will be accepted in full a t the w eighted average price (in th ree decim als) of accepted com petitive bids for the respective issues. S ettlem ent for accepted tenders fo r bills to be m aintained on the book-entry records of F ed eral R eserve B anks and B ranches, and bills issued in bearer form m ust be m ade o r com pleted a t the F e d eral R eserve B ank o r B ran ch or a t the B ureau of the P ublic D ebt on Ju ly 6, 1978, in cash or other im m ediately available funds o r in T re a su ry bills m atu rin g Ju ly 6, 1978. C ash ad ju stm en ts will be m ade fo r differences betw een the p a r value of the m atu rin g bills accepted in exchange and the issue price of the new bills. U n d e r Sections 4 5 4 (b ) and 1221(5) of the In tern a l Revenue Code of 1954 the am ount of discount a t w hich these bills a re sold is considered to accrue w hen the bills are sold, redeem ed o r o th e r wise disposed of, and the bills are excluded from consideration as capital assets. A ccordingly, the ow ner of these bills (o th e r than life insurance com panies) m ust include in his o r her F ed eral in come ta x re tu rn , as o rd in ary gain o r loss, the difference betw een the price paid for the bills, w h eth er on original issue or on sub sequent purchase, and the am ount actually received e ith e r upon sale or 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. D ep artm en t of the T re a su ry C ircu lars N o. 418 (c u rre n t re v i sion) and Public D ebt S eries— N os. 26-76 and 27-76, and this notice, prescribe the term s of these T re a su ry bills and govern the conditions of th eir issue. Copies of the circu lars and tender form s m ay be obtained from any F ed eral R eserve B ank o r B ranch, or from the B ureau of the P ublic Debt. This Bank will receive tenders for both series up to 1 :30 p.m., Eastern Daylight Saving time, Monday, July 3, 1978, 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.” Forms for submitting tenders directly to the Treasury are available from the Government Bond Division of the Bank. Tenders not requiring a deposit may be submitted by telegraph, subject to written confirmation; no tenders may be submitted by telephone. Payment for Treasury bills cannot be made by credit through the Treas ury 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 June 29, 1978, representing an additional amount of bills dated March 30, 1978, maturing September 28, 1978; and 182-day bills dated June 29, 1978, maturing December 28, 1978) are shown on the reverse side of this circular. P aul A. V olcker, P r e s id e n t. ( over) RESULTS OF LAST WEEKLY OFFERING OF TREASURY BILLS (TWO SERIES TO BE ISSUED JUNE 29, 1978) Range of Accepted Competitive Bids 91-Day Treasury Bills Maturing September 28, 1978 P r ic e High .............................................. Low .............................................. Average ........................................ 98.245a 98.237 98.239 D is c o u n t R a te I n v e s tm e n t R a te 1 6.943% 6.975% 6.967% 7.17% 7.20% 7.19% 182-Day Treasury Bills Maturing December 28, 1978 P r ic e 96.266b 96.258 96.261 D is c o u n t R a te I n v e s tm e n t R a te 1 7.386% 7.402% 7.396% 7.78% 7.80% 7.79% b E x ce p tin g one ten d er of $1,790,000. 1 E q u iv alen t coupon-issue yield. a E x ce p tin g th ree tenders to ta lin g $480,000. (52 percent of the amount of 182-day bills bid for at the low price was accepted.) (97 percent of the amount of 91-day bills bid for at the low price was accepted.) Total Tenders Received and Accepted 91-Day Treasury Bills Maturing September 28, 1978 R e c e iv e d F .R . D i s t r i c t ( a n d U S . T r e a s u r y ) Boston........................................ New York.................................. Philadelphia .............................. Cleveland .................................. Richmond .................................. Atlanta ...................................... Chicago...................................... St. Louis.................................... Minneapolis .............................. Kansas City .............................. Dallas ......................................... San Francisco .......................... U.S. Treasury .......................... T otals ................................... $ 17,870,000 3,519,985,000 29,050,000 38,025,000 16,405,000 23,200,000 172,455,000 34,155,000 14,410,000 21,660,000 17,075,000 272,370,000 $ 17,720,000 1,891,125,000 29,050,000 23,025,000 14,405,000 23,100,000 118,240,000 23,155,000 11,320,000 20,860,000 11,075,000 111,470,000 5,925,000 $2,300,470,000c c Includes $315,650,000 noncom petitive tenders from the public. d Includes $191,025,000 noncom petitive tenders from the public. R e c e iv e d A c c e p te d 5,925,000 $4,182,585,000 182-Day Treasury Bills Maturing December 28,1978 $ 11,160,000 4,720,340,000 7,545,000 57,260,000 29,655,000 30,290,000 310,105,000 33,170,000 12,550,000 14,850,000 8,400,000 464,035,000 2,980,000 $5,702,340,000 A c c e p te d $ 11,160,000 2,796,160,000 7,305,000 16,070,000 8,655,000 19,095,000 165,445,000 20,110,000 7,150,000 14,485,000 8,400,000 323,035,000 2,980,000 $3,400,050,000 d