T-bills: Information for Individuals

Treasury bills (T-bills) are short-term Singapore Government Securities (SGS) issued at a discount to their face value. Investors receive the full face value at maturity. The Government issues 6-month and 1-year T-bills.

Overview

Product Information

Key Details

SGS T-bills are fully backed by the Singapore Government.

Issuer
Government of Singapore
Sovereign credit rating
AAA
Tenor
6 months or 1 year
Currency
SGD
Interest rate
No coupon. Issued at a discount to the face value
Tax
There is no capital gains tax in Singapore.
  • For individuals, interest income earned on SGS is tax exempt.
  • Non-residents without a permanent establishment in Singapore do not have to pay taxes on interest income.

Compare with other SGS products 

What It Is Good For

Use T-bills to:

  • Diversify your investment portfolio.
  • Receive a fixed interest payment at maturity.
  • Invest in a safe, short-term investment option.

Buying and Selling

Investors can purchase T-bills at auction. Auctions typically take place 3 business days before issuance and are announced on the SGS website 5 business days before the auction.

You can apply through DBS/POSB, OCBC and UOB ATMs or internet banking. Find out how individuals can buy SGS bonds.

Frequency of issuance
Quarterly, according to the issuance calendar.
Method of sale
Uniform price auction - investors can submit competitive or non-competitive bids.
Bid format
In yield terms, up to 2 decimal places.
Investment amount

Minimum S$1,000, and in multiples of S$1,000.

  • There is no maximum amount an individual can hold, but there are limits for each auction.
  • You can submit up to S$1 million in non-competitive bids at each T-bill auction.
Typical issue size
S$2 billion to S$4 billion.
Who can buy
All institutions and individuals, including non-residents. Individuals need to be 18 years and above.
Buy with SRS and CPF
Yes
Settlement
T+3 at auction; T+1 in the secondary market.
Custody
At the Central Depository .
Secondary market trading
At DBS, OCBC and UOB main branches. View branch and contact details.

Frequently Asked Questions

Here are the Top 5 T-bills FAQs. Read more on T-bills FAQs.

How and Where can I check my T-bills holdings?

For individual investors, if your application for the T-bills was successful, the T-bills holding will be reflected in your respective accounts after the issuance date.

  • For cash application: You can check your CDP notification statement via CDP Internet after 6pm on issuance date. If you have opted for paper statements from CDP, the statements are typically mailed to investors from the 4th business day of each month. Please note that every 10 units on the CDP statement represents S$1,000 in face value of your T-bills holdings. For questions on your CDP account or CDP statement, please contact CDP at 6535 7511.
  • For SRS application: You can check the statements from your SRS Operator (DBS/POSB, OCBC and UOB are SRS operators).
  • For CPFIS-OA application: You can check the CPFIS statement sent by your agent bank (DBS/POSB, OCBC and UOB are CPFIS agent banks).
  • For CPFIS-SA application: You can check your CPF statement.
How are the T-bills allotted and how are the yields of the T-bills allotted to me determined?

T-bills are issued via a uniform-price auction. This means that all successful applications, whether non-competitive or competitive, will be allotted the T-bills at a uniform yield, which is the cut-off yield. The cut-off yield of the T-bills auction is the highest accepted yield of successful competitive applications submitted at the auction.

In a T-bills auction, allotment starts with the non-competitive applications, followed by the competitive applications:

  • Non-competitive applications are allotted first, up to 40% of the total issuance amount. If the total amount of non-competitive applications exceeds 40%, the T-bills will be allotted to non-competitive applications on a pro-rated basis. However, to ensure that the final allotments are in denominations of S$1,000, adjustments will be made by the system on a randomised basis.
  • The rest of the issuance amount will be awarded to competitive applications, starting from the lowest to the highest yields submitted.

Illustration

Here is a stylised example to illustrate the allotment process for T-bills, which assumes:

Total Issuance Size of T-bills  S$20,000
Total Non-competitive Applications Received  S$8,000
Total Competitive Applications Received  S$18,000
 

For this example, the allotment will be as follows:

  • The non-competitive applications will be allotted first. As the non-competitive applications of S$8,000 is within 40% of the issuance size (i.e. S$8,000), the non-competitive applications will be fully allotted. This means that everyone who submitted a non-competitive application will be allotted the amount that they had bid for, capped at S$1 million per T-bills auction.
  • The competitive applications will be allotted next based on the remaining auction amount of S$12,000. The applications will be allotted starting with the lowest yield, and move to the next lowest yield and so on until the remaining auction amount of S$12,000 is reached.
Competitive or
Non-competitive 
Application amount Allotment amount Cumulative allotment amount  Remarks

Non-competitive applications (A)

S$1,000 S$1,000
(fully allotted)
S$1,000  

Non-competitive applications (B)

S$3,000 S$3,000
(fully allotted) 
S$4,000  

Non-competitive applications (C) 

S$4,000  S$4,000
(fully allotted) 
S$8,000  
Total of
Non-competitive applications 
S$8,000  S$8,000
(100% of non-competitive applications allotted)
S$8,000 In this example, the non-competitive applications were 100% allotted as the total amount of non-competitive applications was within 40% of the total issuance amount.

Competitive applications at 1%

S$3,000 S$3,000
(fully allotted) 
S$11,000 All applications at this yield were fully allotted as it is below the cut-off yield.

Competitive applications at 2%

S$4,000 S$4,000
(fully allotted)
S$15,000 All applications at this yield were fully allotted as it is below the cut-off yield. 

Competitive applications at 3% 

S$4,000 S$4,000
(fully allotted) 
S$19,000  All applications at this yield were fully allotted as it is below the cut-off yield.  

Competitive applications at 4%  

S$5,000  S$1,000
(pro-rated allotment)
 
S$20,000 
  • Applications at 4% are pro-rated as the total issuance size has been reached.
  • 4% becomes the cut-off yield for this auction.
  • Approximately 20% of competitive applications at this cut-off yield were allotted.

Competitive applications at 5%

S$2,000  Applications at this yield were not allotted as the total issuance size has been met. 
Total of Competitive applications S$18,000  S$12,000 S$20,000   4% becomes the cut-off yield for this auction. 
In summary        
Total of both
Non-competitive and Competitive
applications
S$26,000
(Non-competitive S$8,000, Competitive S$18,000)
S$20,000
(Non-competitive S$8,000, Competitive S$12,000)
S$20,000 Cut-off yield = 4%.

In this example, the cut-off yield is 4%. All allotted applications, non-competitive and competitive, will receive the same cut-off yield of 4%.

How do I compute my initial investment amount for my T-bills based on the cut-off yield?

T-bills are issued at a discount to the face value.

The cut-off yield at an auction determines the cut-off price of the T-bills, based on the formula below:
D = M/365 X R
P = S$100 – D

Where:
D = full discount per S$100 face value
M = days to maturity
R = annual rate of discount (yield), expressed as %
P = dollar price per S$100 face value

For example, if the cut-off yield for a 6-month T-bills with 182 days to maturity is 4.00%, this translates to a cut-off price of S$98.005 (rounded to 3 decimal places) per S$100 in face value. This means that for every S$1,000 of T-bills that was allotted to you, your initial investment amount would be S$980.05.

What is the maximum amount of T-bills that I can apply for as an individual investor?
The sum of the competitive and non-competitive applications that may be allotted to an individual is capped at 15% of the issuance size of the T-bills auction.

In addition, the maximum allotment for non-competitive applications per individual is S$1 million per T-bills auction.

How do I read the T-bills auction results?
In a uniform-price auction, successful non-competitive and competitive applications will be allotted the T-bills at the Cut-off Yield and Cut-off Price. The Cut-off Yield refers to the highest accepted yield of successful competitive applications, and the Cut-off Price refers to the price corresponding to the Cut-off Yield. See question on "How do I compute my initial investment amount for my T-bills based on the cut-off yield?" for the formula to compute the cut-off price.

If you have placed a non-competitive application, you may refer to the % of Non-Competitive Applications Allotted for the percentage of allotment given to non-competitive applications for the auction. If you have placed a competitive application at the Cut-off Yield, you may refer to the % of Competitive Applications at Cut-off Allotted for the percentage of allotment given to applicants who bid exactly at the cut-off yield for the auction.

Do note that in the event of over-subscription, individual allotments will be adjusted on a randomised basis to ensure that allotments are in denomination of S$1,000.

For more information on the competitive bidding behaviour in an auction, you may also refer to the Median Yield and Average Yield. The Median Yield refers to the yield corresponding to the median of successful competitive applications, while the Average Yield refers to the sum product of the amount of successful competitive applications and the respective application yields, divided by the total amount of successful competitive applications. The results for each T-bills issue may differ depending on investors’ bidding behaviour.

 

Contact Us

Can't find the information you're looking for? Contact us with your question.