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FEDERAL RESERVE BANK OF N E W YORK Fiscal Agent o f the United States Circular No. 8406 August 18, 1978 T R E A S U R Y T O A U C T IO N $ 3 ,0 0 0 M IL L IO N O F 2 -Y E A R N O T E S 7o A// THsOfM S, OoM ;b rAc -SecowJ OfAers CoMcernetf, Reserve The following statement was issued yesterday by the Treasury Department: The Departm ent o f the Treasury will auction $3,0 0 0 mili'on o f 2-year notes to refund $2,749 million o f notes maturing August 31, 1978, and to raise $251 million new cash. The $2,7 4 9 million o f maturing notes are those held by the public, including $775 million currently held by Federal Reserve Banks as agents for foreign and international monetary authorities. In addition to the public holdings, Government accounts and Federal Reserve Banks, for their own accounts, hold $200 million o f the maturing securities that may be refunded by issuing additional amounts o f the new notes at the average price o f accepted competitive tenders. Additional amounts o f the new securities may also be issued at the average price, for new cash only, to Federal Reserve Banks as agents for foreign and international monetary authorities. Details about the new security are given in the attached highlights o f the offering and in the official offering circular. Printed on the reverse side's a table summarizing the highlights of the offering. Copies of the official offering circular will be furnished upon request directed to our Government Bond Division (Tel. No. 212-791-6619). Efic/o s ( arc copies o/'a stafuiarJ /orm t i l can &e useef m .e7 /a any si/EseqHewf o^en'ag o * 2-year aofes. / fencers/or f n s /' or/or This Bank will receive tenders up to 1:30 p.m., Eastern Daylight Saving time, Wednesday, August 23, 1978, at the Securities Department of its Head Office and at its Buffalo Branch. 4 // competiY/ve tempers, whether transmitted by mail or by other means, must reach this Bank or its Branch by that time. However, for investors who wish to submit noncompetitive tenders and who find it more convenient to mail their tenders than to present them in person, the official offering circular provides that noncompetitive tenders will be considered timely received if they are mailed to this Bank or its Branch under a postmark no /ater t/ian /lagint 22. Bidders submitting noncompetitive tenders should realize that it is possible that the average price may be above par, in which case they would have to pay more than the face value for the securities. Payment may be made by personal check, or an official bank check, payable on its face to the Federal Reserve Bank of New York; cAccEs em/orseef fo t/iTs Z?anA^ wi7/ nof accepfci/. A personal check sub mitted with the tender, either as a deposit or for the face amount of the securities, does not have to be certified. However, in cases where only a deposit is submitted with the tender, a personal check submitted for the final payment must be certified. As provided in the official offering circular, "in every case where full payment is not completed on time, the deposit submitted with the tender, up to 5 percent of the face amount of securities allotted, shall, at the discretion of the Secretary of the Treasury, be forfeited to the United States." A recorded message (at the Head Office — Tel. No. 212-791-5823; at the Buffalo Branch — Tel. No. 716-849-5046) provides information about this and other Treasury offerings; additional inquiries regarding this offering may be made by calling, at the Head Office, Tel. No. 212-791-6619, or, at the Buffalo Branch, Tel. No. 716-849-5016. (If the inquiry relates to competitive tenders, however, the Head Office number to call is 212-791-5465.) PAUL A. VOLCKER, PrasiJeMt. (Over) HIGHLIGHTS OF TREASURY OFFERING TO THE PUBLIC OF 2 YEAR NOTES TO BE ISSUED AUGUST 31,1978 (De/tveyy dafe ^br coupon -secMrtfies M September 7, 797^) Amount Offered: To the public................................. $3,000 million Description of Security: Term and type of security............ 2-year notes Series and CUSIP designation . . . Series S-1980 (CUSIP No. 912827 HZ8) Maturity d a t e ............................... August 31,1980 Call d a t e ....................................... No provision Interest coupon rate..................... To be determined, based on the average of accepted bids Investment yield ........................... To be determined at auction Premium or discount................... To be determined after auction Interest payment dates.................. February 28 and August 31, 1979; and February 29 and August 31, 1980 Minimum denomination available $5,000 Terms of Sale: Method of sale ............................................. Yield auction Accrued interest payable by investor........... None Preferred allotment....................................... Noncompetitive bid for $1,000,000 or less Deposit requirement....................................... 5% of face amount Deposit guarantee by designated institutions Acceptable Key Dates: Deadline for receipt of tenders.......................................................................... Wednesday, August 23, 1978 by 1:30 p.m., EDST Settlement date (final payment due) a) Cash or Federal funds................................................................................ Thursday, August 31, 1978 b) Check drawn on bank within FRB district where submitted.................. Tuesday, August 29, 1978 c) Check drawn on bank outside FRB district where submitted................ Monday, August 28, 1978 T Delivery date for coupon securities...................... ............... ! .................... Friday, September 1,1978 N O T I C E PUBLIC ANNOUNCEMENTS OF TWO-YEAR TREASURY NOTE OFFERINGS To the Addressee: The regular monthly auctions of 2-year Notes by the Treasury are expected to continue for the foreseeable future. We are, therefore, changing our procedures for notifying the public about these auctions. These changes will help us cut costs, as veil as provide you vith better service. The accompanying circular describes the Treasury's August 2-year Note auction and vill be the last ve vill send out regarding the regular monthly offerings of 2-year Notes. The predictable nature of these offerings makes it unnecessary to issue this circular each month. Rather, ve feel ve can bring you more timely and relevant information in other vays, vhich are described belov. We vill, of course, inform you if there is a change in the pattern of monthly offerings. This does not mean that your name is being removed from our regular mailing lists. As in the past, you vill continue to receive announcements of, and tender forms for, nev offerings of Treasury notes and bonds that are not auctioned on a routine basis. Hov to subscribe in future auctions of 2-year Notes It is the practice of the Treasury Department, vith fev exceptions, to announce the offering of 2-year Notes on or before the 15th of each month, and to set the auction date about one veek after the announcement date. The tender must be delivered to the Bank by 1:30 p.m. on the auction date specified by the Treasury, or, if it is a noncompetitive tender and you prefer to mail the tender, it must be postmarked not later than the date preceding the auction date. Please note that the above guidelines do not provide you vith exact or firm dates. These are announced by the Treasury shortly before the actual offering and can be obtained from a variety of sources, including the nevs media. This Bank has a recorded, 2^-hour telephone service vhich provides current offering information. The number to call at the Head Office in Nev York City is 212-791-5823. The number at the Buffalo Branch is 716-8^9-50^6. For your convenience, enclosed are copies of standard tender forms that you may use in subscribing to future offerings of 2-year Treasury Notes. They should be retained until you vish to subscribe for these securities. Additional copies of the standard tender form are available from the Government Bond Division. Although ve prefer that you use the standard form, you may, instead, send a letter stating that you vant to purchase 2-year Notes, including the face amount and denominations you vant to buy, and your delivery instructions. For registered securities, include the name(s), social security number, and the mailing address for semi-annual interest checks. The Treasury requires this data and vill not complete the transaction vithout all of it. Your tender form or (Over) letter must be accompanied by payment in the required form and amount (if check, payable on its face to the Federal Reserve Bank of New York). w w x If, as an employee of a bank or other financial institution, you need printed copies of the Bank's circulars for auctions of 2-year Notes on a regular basis in order to serve your firm's customers, we will place your name on a separate mailing list upon receipt of a written request on your firm's stationery. Others with a similar need may also submit written requests to the Circulars Division setting forth the reasons why these announcements are needed. Ve would appreciate your cooperation in refraining from making such requests unless absolutely necessary. Copies of 2-year Note offering announcements will continue to be available at the Bank at the Government Bond Information Desk and in the Public Information Department, as well as at the Buffalo Branch. We will continue to explore ways to improve our service to you and will keep you informed of future developments. Any suggestions you may have for other improvements would be appreciated and should be sent to the Government Bond Division. Government Bond and Safekeeping Department FEDERAL RESERVE BANK OF NEW YORK August 18 , 1978 FORM NA-2YR IMPORTANT— This is a standard form. Its terms are subject to change at any time by the Treasury. This tender will be construed as a bid to purchase the 2-year notes for which the Treasury has out standing an invitation for tenders on the date received by the Federal Reserve Bank of New York or its Buffalo Branch. T E N D E R FO R 2 -Y E A R T R E A S U R Y N O TES ><*o 33. -s To FEDERAL RESERVE BANK O Nsw YoRK F Fiscal Agent of the United States New York, N.Y. 10045 Do not /i/1 w &oM Cow ^fM w uwd AoHCOfM^pMw^ O O f forw M M $........................................... ............ (maturity value) or any lesser amount that may be awarded. (Tfc/d nmjf dccfma/ 0 -— ^ on Y ie ld : ................... wot wore /Aon two NONCOMPETITIVE TENDER $....................................................... (maturity value) (Wot to #1 ,000,000 for o t< M&fcr tAroM aM joMrtrrj) ?? ^A at the average price of accepted competitive bids. for e^aw:f^/e, 7.11) Subject to allotment, please issue, deliver, and accept payment for the securities as indicated below and the reverse side ( ff rc^Atercrf yeraWfiM arc deyfred, f?/cayc a/so <ro?nf)fctc ycAcdafc on reverse yfdc) .* Pieces .$*5 tj Denominations $ c Maturity value 5,000 $ < o -S 3 ^ 19. Pursuant to the provisions of the public notice issued by the Treasury Department inviting tenders for the current offering of 2-year Treasury notes, the undersigned hereby offers to purchase such currently offered Treasury notes in the amount indicated below, and agrees to make payment therefor at your Bank on or before the issue date at the price awarded on this tender. COMPETITIVE TENDER . 353 Dated a t.................................... 10,000 -5 T3-S- ^ r3*S $ 100,000 O Deliver over the counter to the undersigned G) D Ship to the undersigned (2) D Hold in safekeeping (for member bank only) in— D Investment Account (D D General Account (S) D Trust Account (6) D Hold as collateral for Treasury Tax and Loan Account* (7) Payment will be made as follow s: D By charge to our reserve account (D) Q By cash or check in OMtM^dfufdy uvailo&If /andr (F) Q By surrender of maturing securities (E) D By charge to my correspondent bank ....................................................(D) D Special instructions (3) O $1,000,000 3 d .g 3 ^ D W ire to..............................................................................................................................(8) Totals * The undersigned certifies that the allotted securities will be owned solely by the undersigned. (I f a commercial bank or dealer is subscribing for its own account or for account of customers, the following certifications are made a part of this tender.) WE HEREBY CERTIFY that we have not made and will not make any agreements for the sale or purchase of any securities of this issue prior to the closing time for receipt of this tender. WE FURTHER CERTIFY that we have received tenders from customers in the amounts set forth opposite their names on the list which is made a part of this tender, and that we have received and are holding for the Treasury, or that we guarantee payment to the Treasury, of the deposits stipulated in the official offering cir cular. WE FURTHER CERTIFY that tenders received by us, if any, from other commercial banks or primary dealers for their own account, and for the account of their customers, have been entered with us under the same con ditions, agreements, and certifications set forth in this form. Name of Subscriber (Please Print or Type) vjc & C S ^ .S J O M 'C Gv Address G *G g - §?*** p.S gs '*3 g Insert t/ds tender fn specMt% envelope ntar&ed City State Zip "Tender /o r Treasury Notes or Bonds" Phone (Include Area Code) Sum atuteof Subscriber or Authorized Signature a : Ho x g .s 'S M g g ^ a W v tE^ K*B M L< .s K3 S v cr K > 3 S .2 12 "* C< Sf.g 3 L K EJf ^ 3 c < G3 -t (Institutions submitting tenders for customer account must list customers' names on lines below or on an attached rider) IN S T R U C T IO N S : 1. No tender for less than $5,000 will be considered; and each tender must be for a multiple of $5,000 (maturity value). 2. Only banking institutions, and dealers who make primary markets in Government securities and report daily to this Bank their positions with respect to Government securities and borrowings thereon, may submit tenders for customer account; in doing so, they may consolidate competitive tenders a? t/n? .Mwc yfcfd and may consolidate noncompetitive tenders, provided a list is attached showing the name of each bidder and the amount bid for his account. Others will not be permitted to submit tenders except for their own account. 3. Tenders will be received without deposit from commercial and other banks for their own account, Federally-insured savings and loan associations, States, political subdivisions or instrumentalities thereof, public pension and retirement and other public funds, international organizations in which the United States holds membership, foreign central banks and foreign States, dealers who make primary markets in Government securities and report daily to the Federal Reserve Bank of New Y ork their positions with respect to Government securities and borrowings thereon, and Government accounts. Tenders from others must be accompanied by payment of at least 5 percent of the face amount of the securities applied for. 4. A personal check, cash, or Treasury securities maturing on or before the issue date of the new securities may be submit ted with the tender. Personal checks submitted with the tender, either as a deposit or for the face amount of the securities, do no? have to be certified. However, in cases where only a deposit is submitted with the tender, a personal check submitted for the final payment must be certified and received at this Bank on the payment date (which is generally three business days before the issue date) shown on the "Notice o f Balance Due" that will be mailed to you. AH checks must be payable on its face to the Federal Reserve Bank of New Y ork ; endowed wfff no I & a c c e ^ d . Settlement on the issue date must be in cash or in other immediately available funds. 5. A recorded message (at the Head Office— Tel. No. 212-791-5823; at the Buffalo Branch— Tel. No. 716-849-5046) pro vides information about Treasury offerings; additional inquiries regarding Treasury offerings may be made by calling, at the Head Office, Tel. No. 212-791-6619, or, at the Buffalo Branch, Tel. No. 716-849-5016. (If the inquiry relates to competitive tenders, however, the Head Office number to call is 212-791-5465.) 6. If the language of this tender is changed in any respect that, in the opinion of the Secretary of the Treasury, is material, the tender may be disregarded. (O V E R ) SCHEDULE FOR ISSUE OF REGISTERED 2-YEAR TREASURY NOTES SUBSCR!PT!ON NO DELtVERY [NSTRUCTtONS PAYMENT tNSTRUCHONS SUBSCRIBER'S NAME n DELtVER OVER THE COUNTER O BY CHARGE TO OUR RESERVE A C C O U N T ADDRESS___________ D SHIP T O SUBSCRtBER n BY CASH O R CHECK CITY______________ n STATE D NO. OF PIECES REGISTRATION INSTRUCTIONS DENOM. 32 CITY STATE 1,000,000 9V ADDRESS TOTAL TR. CASE NO. ZIP 32 CITY 1,000,000 99 STATE 100,000 42 ADDRESS 10,000 38 ID OR S.S. NO. 5,000 34 NAME(S) TOTAL TR. CASE NO. ZIP NAME(S) FOR FRB USE ONLY 100,000 42 ID OR S.S. NO. INTEREST COMP. DATE 10,000 38 SERIAL NOS. (LEAVE BLANK) BY CHARGE TO M Y CORRESPONDENT BAN K !SSUE AGENT 12 5,000 34 NAME(S) AMOUNT BY SURRENDER OF M ATU RIN G SECUR!T!ES n S!GNATURE TRANS. ACCOUNTING DATE IN (M FD/ATFLY AYAHABUE FUNDS M OTHER INSTRUCTIONS: Z IP FOR FRB USE ONLY 32 5 000 34 10,000 38 100,000 ID OR S.S. NO. 42 1,000,000 ADDRESS 99 TOTAL CITY STATE ZIP TR. CASE NO. LOAN CODE 11001 UNITED STATES OF AMERICA TREASURY NOTES OF AUGUST 31, 1980 SERIES S-1980 DEPARTMENT CIRCULAR Public Debt Series - No. 20-78 DEPARTMENT OF THE TREASURY, OFFICE OF THE SECRETARY, Washington, August 18, 1978 1. INVITATION FOR TENDERS 1. 1. The Secretary of the Treasury, under the authority of the Second Liberty Bond Act, as amended, invites tenders for approximately $3,000,000,000 of United States securities, designated Treasury Notes of August 31, 1980, Series S-1980 (CUSIP No. 912827 HZ 8). The securities will be sold at auction with bidding on the basis of yield. Payment will be required at the price equivalent of the bid yield of each accepted tender. The interest rate on the securities and the price equivalent of each accepted bid will be determined in the manner described below. Additional amounts of these securities may be issued to Government accounts and Federal Reserve Banks for their own account in exchange for maturing Treasury securities. Additional amounts may also be issued for cash to Federal Reserve Banks as agents of foreign and international monetary authorities. 2. 2. 1. DESCRIPTION OF SECURITIES The securities will T e dated August 31, 1978, and S will bear interest from that date, payable on a semiannual basis on February 28 and August 31, 1979; February 29 and August 31, 1980. They will mature August 31, 1980, and will not be subject to call for redemption prior to maturity. 2. 2. The income derived from the securities is subject to all taxes imposed under the Internal Revenue Code of 1954. The securities are subject to estate, inheritance, gift or other excise taxes, whether Federal or State, but are exempt from all taxation now or hereafter imposed on the principal or interest thereof by any State, any possession of the United States, or any local taxing authority. -2 - 2. 3. The securities will be acceptable to secure deposits of public monies. They will not be acceptable in payment of taxes. 2. 4. Bearer securities with interest coupons attached, and securities registered as to principal and interest, will be issued in denominations of $5,000, $10,000, $100,000, and $1,000,000. Book-entry securities will be available to eligible bidders in multiples of those amounts. Interchanges of securities of different denominations and of coupon, registered and book-entry securities, and the transfer of registered securities will be permitted. 2. 5. The Department of the Treasury's general regulations governing United States securities apply to the securities offered in this circular. These general regulations include those currently in effect, as well as those that may be issued at a later date. 3. 1. 3. SALE PROCEDURES Tenders will be received at Federal Reserve Banks and Branches and at the Bureau of the Public Debt, Washington, D. C. 20226, up to 1:30 p.m., Eastern Daylight Saving time, Wednesday, August 23, 1978. Noncompetitive tenders as defined below will be considered timely if postmarked no later than Tuesday, August 22, 1978. 3. 2. Each tender must state the face amount of securities bid for. The minimum bid is $5,000 and larger bids must be in multiples of that amount. Competitive tenders must also show the yield desired, expressed in terms of an annual yield with two decimals, e.g., 7.11%. Common fractions may not be used. Noncompetitive tenders must show the term "noncompetitive" on the tender form in lieu of a specified yield. No bidder may submit more than one noncompetitive tender and the amount may not exceed $ 1 ,000 ,000 . 3. 3. All bidders must certify that they have not made and will not make any agreements for the sale or purchase of any securities of this issue prior to the deadline established in Section 3.1. for receipt of tenders. Those authorized to submit tenders for the account of customers will be required to certify -3- that such tenders are submitted under the same conditions, agree ments, and certifications as tenders submitted directly by bidders for their own account. 3. 4. Commercial banks, which for this purpose are defined as banks accepting demand deposits, and primary dealers, which for this purpose are defined as dealers who make primary markets in Government securities and report daily to the Federal Reserve Bank of New York their positions in and borrowings on such securities, may submit tenders for account of customers if the names of the customers and the amount for each customer are furnished. Others are only permitted to submit tenders for their own account. 3. 5. Tenders will be received without deposit for their own account from commercial banks and other banking institutions; primary dealers, as defined above; Federally-insured savings and loan associations; States, and their political subdivisions or instrumentalities; public pension and retirement and other public funds; international organizations in which the United States holds membership; foreign central banks and foreign states; Federal Reserve Banks; and Government accounts. Tenders from others must be accompanied by a deposit of 5% of the face amount of securities applied for (in the form of cash, maturing Treasury securities or readily collectible checks), or by a guarantee of such deposit by a commercial bank or a primary dealer. 3. 6. Immediately after the closing hour, tenders will be opened, followed by a public announcement of the amount and yield range of accepted bids. Subject to the reservations expressed in Section 4, noncompetitive tenders will be accepted in full, and then competitive tenders will be accepted, starting with those at the lowest yields, through successively higher yields to the extent required to attain the amount offered. Tenders at the highest accepted yield will be prorated if necessary. After the determination is made as to which tenders are accepted, a coupon rate will be established, on the basis of a 1/8 of one percent increment, which results in an equivalent average accepted price close to 100.000 and a lowest accepted price above the original issue discount limit of 99.500. That rate of interest will be % -4- paid on all of the securities. Based on such interest rate, the price on each competitive tender allotted will be determined and each successful competitive bidder will be required to pay the price equivalent to the yield bid. Those submitting noncompetitive tenders will pay the price equivalent to the weighted average yield of accepted competitive tenders. Price calculations will be carried to three decimal places on the basis of price per hundred, e.g., 99.923, and the determinations of the Secretary of the Treasury shall be final. If the amount of noncompetitive tenders received would absorb all or most of the offering, competitive tenders will be accepted in an amount sufficient to provide a fair determination of the yield. Tenders received from Government accounts and Federal Reserve Banks will be accepted at the price equivalent to the weighted average yield of accepted competitive tenders. 3. 7. Competitive bidders will be advised of the acceptance or rejection of their tenders. Those submitting noncompetitive tenders will only be notified if the tender is not accepted in full, or when the price is over par. 4. 1. 4. RESERVATIONS The Secretary of the Treasury expressly reserves the right to accept or reject any or all tenders in whole or in part, to allot more or less than the amount of securities specified in Section 1, and to make different percentage allotments to various classes of applicants when the Secretary considers it in the public interest. The Secretary's action under this Section is final. 5. 5. 1. PAYMENT AND DELIVERY Settlement for allotted securities must be made or completed on or before Thursday, August 31, 1978, at the Federal Reserve Bank or Branch or at the Bureau of the Public Debt, wherever the tender was submitted. Payment must be in cash; in other funds immediately available to the Treasury; in Treasury bills, notes or bonds (with all coupons detached) maturing on or before the settlement date but which are not overdue as defined in the general regulations governing United States securities; or by check drawn to the order of the institution to which the -5- tender was submitted, which must be received at such institution no later than: (a) Tuesday, August 29, 1978, if the check is drawn on a bank in the Federal Reserve District of the institution to which the check is submitted (the Fifth Federal Reserve District in case of the Bureau of the Public Debt), or (b) Monday, August 28, 1978, if the check is drawn on a bank in another Federal Reserve District. Checks received after the dates set forth in the preceding sentence will not be accepted unless they are payable at the applicable Federal Reserve Bank. Payment will not be considered complete where registered securities are requested if the appropriate identifying number as required on tax returns and other documents submitted to the Internal Revenue Service (an individual's social security number or an employer identification number) is not furnished. When payment is made in securities, a cash adjustment will be made to or required of the bidder for any difference between the face amount of securities presented and the amount payable on the securities allotted. 5. 2. In every case where full payment is not completed on time, the deposit submitted with the tender, up to 5 percent of the face amount of securities allotted, shall, at the discretion of the Secretary of the Treasury, be forfeited to the United States. 5. 3. Registered securities tendered as deposits and in payment for allotted securities are not required to be assigned if the new securities are to be registered in the same names and forms as appear in the registrations or assignments of the securities surrendered. When the new securities are to be registered in names and forms different from those in the inscriptions or assignments of the securities presented, the assignment should be to "The Secretary of the Treasury for (securities offered by this circular) in the name of (name and taxpayer identifying number)." If new securities in coupon form are desired, the assignment should be to "The Secretary of the Treasury for coupon (securities offered by this circular) to be - 6 - delivered to (name and address)." Specific instructions for the issuance and delivery of the new securities, signed by the owner or authorized representative, must accompany the securities presented. Securities tendered in payment should be surrendered to the Federal Reserve Bank or Branch or to the Bureau of the Public Debt, Washington, D. C. 20226. The securities must be delivered at the expense and risk of the holder. 5. 4. If bearer securities are not ready for delivery on the settlement date, purchasers may elect to receive interim certificates. These certificates shall be issued in bearer form and shall be exchangeable for definitive securities of this issue, when such securities are available, at any Federal Reserve Bank or Branch or at the Bureau of the Public Debt, Washington, D. C. 20226. The interim certificates must be returned at the risk and expense of the holder. 5. 5. Delivery of securities in registered form will be made after the requested form of registration has been validated, the registered interest account has been established, and the securities have been inscribed. 6. 6. 1. GENERAL PROVISIONS As fiscal agents of the United States, Federal Reserve Banks are authorized and requested to receive tenders, to make allotments as directed by the Secretary of the Treasury, to issue such notices as may be necessary, to receive payment for and make delivery of securities on full-paid allotments, and to issue interim certificates pending delivery of the definitive securities. 6. 2. The Secretary of the Treasury may at any time issue supplemental or amendatory rules and regulations governing the offering. Public announcement of such changes will be promptly provided. Paul H. Taylor, Fiscal Assistant Secretary.
@FedFRASER