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FED ERAL R E SE R V E B A N K O F N E W YO R K Fiscal Agent of the United States r Circular No 8 4 2 8 1 L October 2, 1978 J OFFERING OF TWO SERIES OF TREASURY BILLS $2,300,000,000 of 91-Day Bills, Additional Amount, Series Dated July 13, 1978, Due January 11, 1979 (To Be Issued October 12, 1978) $3,400,000,000 of 182-Day Bills, Dated October 12, 1978, Due April 12, 1979 71? A // owd Cow/WMay, ord CowaarMad, w tAa JaaoMd FaJa^a/ Fa^ar^a Df.yfr:ct; <??*.! Following is the text of a notice issued by the Treasury Department, released September 29, 197 8 : The Department of the Treasury, by this public notice, invites determined in the auction. tenders for two series of Treasury bills totaling approximately N o deposit need accompany tenders from incorporated banks $5,700 million, to be issued October 12, 1978. This offering will and trust companies and from responsible and recognized dealers not proviae new cash for the Treasury as the maturing bills are in investment securities for bills to be maintained on the book-entry outstanding in the amount of $5,708 million. The two series offered records of Federal Reserve Banks and Branches, or for bills issued in bearer form, where authorized. A deposit of 2 percent of the par are as follow s: amount of the bills applied for must accompany tenders for such 91-day bills (to maturity date) for approximately $2,300 bills from others, unless an express guaranty of payment by an million, representing an additional amount of bills dated incorporated bank or trust company accompanies the tenders. July 13, 1978, and to mature January 11, 1979 (C U S IP Public announcement will be made by the Department of the No. 912793 W 3 6), originally issued in the amount of Treasury of the amount and price range of accepted bids. Competi $3,406 million, the additional and original bills to be tive bidders will be advised of the acceptance or rejection of their freely interchangeable. tenders. The Secretary of the Treasury expressly reserves the right 182-day bills for approximately $3,400 million to be dated to accept or reject any or all tenders, in whole or in part, and the October 12, 1978, and to mature April 12, 1979 (C U S IP Secretary's action shall be final. Subject to these reservations, No. 912793 X 84). noncompetitive tenders for each issue for $500,000 or less without Both series of bids will be issued for cash and in exchange for stated price from any one bidder will be accepted in full at the Treasury bills maturing October 12, 1978. Federal Reserve Banks, weighted average price (in three decimals) of accepted competitive for themselves and as agents of foreign and international monetary bids for the respective issues. authorities, presently hold $3,215 million of the maturing bills. Settlement for accepted tenders for bills to be maintained on the These accounts may exchange bills they hold for the bills now book-entry records of Federal Reserve Banks and Branches, and being offered at the weighted average prices of accepted competi bills issued in bearer form must be made or completed at the Fed tive tenders. eral Reserve Bank or Branch or at the Bureau of the Public Debt The bills will be issued on a discount basis under competitive and on October 12, 1978, in cash or other immediately available funds noncompetitive bidding, and at maturity their par amount will be or in Treasury bills maturing October 12, 1978. However, since the payable without interest. Except for definitive bills in the $100,000 Baltimore Federal Reserve Branch will be closed on the settlement denomination, which will be available only to investors who are date, investors purchasing bills through that Branch are given the able to show that they are required by law or regulation to hold following payment options: securities in physical form, both series of bills will be issued entirely 1. Payment with cash, Federal funds, other immediate in book-entry form in a minimum amount of $10,000 and in any credit hems, or check in collected form, by Wednesday, higher $5,000 multiple, on the records either of the Federal Reserve October 11; Banks and Branches, or of the Department of the Treasury. 2. Payment with matured bills by Friday, October 13; Tenders will be received at Federal Reserve Banks and Branches 3. Payment with cash, Federal funds, or other immediate and at the Bureau of the Public Debt, Washington, D. C. 20226, credit items by Friday, October 13, plus one day's accrued up to 1 :30 p.m., Eastern Daylight Saving time, Friday, October 6, 1978. Form PD 4632-2 (for 26-week series) or Form PD 4632-3 interest. Cash adjustments will be made for differences between the par value (for 13-week series) should be used to submit tenders for bills to be maintained on the book-entry records of the Department of the of the maturing bills accepted in exchange and the issue price of the Treasury. new bills. Each tender must be for a minimum of $10,000. Tenders over Under Sections 454(b) and 1221(5) of the Internal Revenue $10,000 must be in multiples of $5,000. In the case of competitive Code of 1954 the amount of discount at which these bills are sold tenders the price offered must be expressed on the basis of 100, is considered to accrue when the bills are sold, redeemed or other with not more than three decimals, e.g., 99.925. Fractions may not wise disposed of, and the bills are excluded from consideration as capital assets. Accordingly, the owner of these bills (other than be used. Banking institutions and dealers who make primary markets in life insurance companies) must include in his or her Federal in Government securities and report daily to the Federal Reserve come tax return, as ordinary gain or loss, the difference between Bank of New Y ork their positions in and borrowings on such the price paid for the bills, whether on original issue or on sub securities may submit tenders for account of customers, if the sequent purchase, and the amount actually received either upon sale names of the customers and the amount for each customer are or redemption at maturity during the taxable year for which the return is made. furnished. Others are only permitted to submit tenders for their own account. Department of the Treasury Circulars No. 418 (current revi Payment for the full par amount of the bills applied for must sion) and Public Debt Series— Nos. 26-76 and 27-76, and this accompany all tenders submitted for bills to be maintained on the notice, prescribe the terms of these Treasury bills and govern the book-entry records of the Department cf the Treasury. A cash conditions of their issue. Copies of the circulars and tender forms adjustment will be made on all accepted tenders for the difference may be obtained from any Federal Reserve Bank or Branch, or from the Bureau of the Public Debt. between the par payment submitted and the actual issue price as This Bank will receive tenders for both series up to 1 :30 p.m ., Eastern Daylight Saving time, Friday, Oafo&er d, i p /# , at the Securities Department of its H ead 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 "T e n der for Treasury B ills." Forms for submitting tenders directly to the Treasury are available from the Government Bond Division o f the Bank. Tenders not requiring a deposit may be submitted by telegraph, subject to written confirmation; no tenders may be submitted by telephone. Paw^a??/ for Praa^ary MFy aaanoi &a ??iada &y area??'; Piroap/i f/ia T ra ajary Pa^r awd Poaw yJaaoawL Pafdawaai taaji &a wada fa aayA or oFtar i?awadiafa/y araiia&ia faady or fa w afariap Praa^ary The results of bidding for the previous offering of Treasury bills, to be issued October 5, 1978, were not available at the time of printing this circular; those results will be announced after release by the Treasury Department. PAUL C lo s in g d a t e f o r r e c e i p t o f t e n d e r s is F r i d a y , O c t o b e r 6 . A. VOLCKER,
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