There are no coupon payments for T-bills.

Instead, T-bills are issued at a discount to the face (par) value. Face/par value refers to S$100 in principal amount of the T-bills applied for. The discount rate of the T-bills is the cut-off yield at the auction. The interest is paid at maturity and is the difference between the purchase price and the face value. 

Non-competitive Application

• In a non-competitive application, you only specify the amount you want to invest and not the yield. You may wish to choose this option if you wish to invest in the bond regardless of the return or are unsure of what yield to bid.
• Do note that in an auction, non-competitive applications will be allotted first, up to 40% of the total issuance amount. If the amount of non-competitive applications exceeds 40%, the T-bills will be allotted to you on a pro-rated basis.
• You will get the T-bills at the cut-off yield, which is the highest accepted yield of successful competitive applications.

Note: Submitting multiple non-competitive applications does not increase the chance of successful allotment. Allotment takes into account the aggregate total amount applied by each investor, and not the number of applications submitted by each investor.

Competitive Application

• If you wish to invest in the T-bills only if it yields above a certain level, you can submit a competitive application.
• In the application, you can specify the minimum yield you are willing to accept in percentage terms, up to 2 decimal places. Please be mindful not to submit in price terms.
• Please note that you may not get the full amount that you applied for, depending on how your application compares to the cut-off yield.
  

Note: A lower yield represents a more competitive application, as you are indicating that you will accept a lower interest rate. You can submit multiple competitive applications.

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 non-competitive application per individual is capped at S$1 million per T-bills auction. Please note that final allotment could be less than S$1 million per T-bills auction, if the total amount of non-competitive applications exceeds 40%, which will result in the T-bills being allotted to non-competitive applications on a pro-rated basis.

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

The cut-off yield at an auction sets the cut-off price of T-bills, based on the formula below.

Formula:

• 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

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. 

For Cash applications: Funds are deducted at point of application. The discount to the face value of your allotted T-bills will be credited into your account within 1 – 3 business days after auction date.

For SRS applications: Funds are earmarked at the point of application, before being deducted within 1 – 3 business days after auction date.

For CPFIS applications: Funds are deducted within 1 – 3 business days after auction date.

Note: Please check with your bank for any transaction charges for using the different funds for application.

There are a few possible reasons why your application was unsuccessful. Some common reasons include:

• Joint CDP accounts cannot be used to buy T-bills. You will need to have an individual CDP Securities account as a holding account to deposit your allotted T-bills.
• Invalid or incorrect CDP account number entered during the application.
• The CDP account used does not have Direct Crediting Service activated.

In addition, please note that there is an allotment limit of S$1 million per individual per T-bills auction for non-competitive applications.

You may wish to check with your bank for the exact reason(s) why your application was rejected. 

Please refer to Buy SGS Bonds and T-bills at Auction: For Individuals

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:

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.

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%.

In a uniform-price auction, successful application bids get T-bills at the Cut-off Yield and Cut-off Price. The Cut-off Yield is the highest accepted yield of successful competitive applications, and the Cut-off Price is the price corresponding to the Cut-off Yield.

Non-Competitive Bids: You may check the "% of Non-Competitive Applications Allotted" for the percentage of allotment given to non-competitive applications for the auction.

Competitive Bids: If you have placed a competitive bid at the Cut-off Yield, you may check 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.

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

For more information on competitive bidding behavior for an auction, you can refer to:

• Median Yield, which refers to the yield corresponding to the median of successful competitive applications.
• Average Yield, which 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.

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

• For Cash applications: Please refer to your online CDP statement via CDP Internet . You can also refer to your paper statement from CDP, if you have opted for one.  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 or asksgx@sgx.com .
• For SRS applications: Please refer to your SRS statement from your SRS Operator (DBS/POSB, OCBC and UOB).
• For CPFIS-OA applications: Please refer to your CPFIS statement from your agent bank (DBS/POSB, OCBC and UOB).
• For CPFIS-SA applications: Please refer to your CPF statement.

This can happen if there is an over-subscription for non-competitive applications (i.e. the total amount of non-competitive applications exceeds 40% of the issuance size). In this situation, the allotment to non-competitive applications will be pro-rated, with individual allotments adjusted on a randomised basis such that allotments are in denomination of S$1,000.

This may also happen if you have made a competitive application at the cut-off yield.

Illustration
Suppose a T-bills auction receives a total of S$15,000 in non-competitive applications for a total issuance size of S$30,000.

As the non-competitive applications of S$15,000 exceeds 40% of the issuance size (i.e. S$12,000), the allotment to non-competitive applications will be pro-rated by approximately 80% (S$12,000/S$15,000). This means that everyone who submitted a non-competitive application will have their allotments pro-rated and adjusted on a randomised basis to ensure that allotments are in denomination of S$1,000.

For cash applications: You will receive a combined refund on the (i) non-allotted amount, and (ii) discount on the face value of T-bills which you have been allotted.

Using a 6-month T-bills with a cut-off yield of 4.00% and cut-off price of S$98.005 (rounded to 3 decimal places) per S$100 in face value as an example. If you have submitted a non-competitive application of S$2,000, and was only allotted S$1,000, you will receive a combined refund of (i) S$1,000 of your non-allotted amount, and (ii) discount on the face value of T-bills, which would be S$19.95.

Note: The discount rate of the T-bills is the cut-off yield at the auction.

For CPFIS and SRS applications: Only the settlement amount (allotted amount net of the discount) will be deducted from your respective accounts.

Using the same example above, if you submitted a non-competitive application of S$2,000 and was only allotted S$1,000, only the settlement amount of S$980.05 will be deducted from your account. 

You will receive the full face value (i.e. principal amount) of the T-bills upon maturity.

The principal amount will be credited to:

• For Cash applications: Your designated Direct Crediting Service bank account. To check your linked bank account, use the CDP Internet  service or refer to your CDP statement.

• For SRS applications: Your SRS account.

• For CPFIS-OA applications: Your CPF Investment Account.

• For CPFIS-SA applications: Your CPF SA account.

Note: If the maturity date falls on a day when MAS’ electronic payment system is not in operation, the transaction will occur on the next business day.

Yes. For cash applications, you can change your nominated bank account for Direct Crediting Service. You can do so via the CDP Internet Service or by contacting CDP Call Centre at 6535 7511.