Treasury Bills (T-bills) & Singapore Government Securities (SGS)

What it is

T-bills and SGS bonds are the wholesale end of Singapore government debt, opened up to retail investors through periodic auctions. T-bills are short-dated (6-month and 1-year), sold at a discount to face value with the return realised at maturity. SGS bonds span much longer tenors (2, 5, 10, 15, 20, 30, and 50-year), paying a fixed coupon semi-annually.

Unlike SSB, both are typically held to maturity or sold on the secondary market if you need to exit early -- there's no built-in penalty-free redemption window, so the price you get on early exit depends on where market yields have moved.

How it's structured

• T-bills: sold at a discount, no coupon -- you receive face value at maturity, with the discount representing your return.
• SGS bonds: pay a fixed coupon every six months and return face value at maturity; price fluctuates on the secondary market before then based on prevailing yields.
• Both are auctioned periodically (T-bills roughly fortnightly to monthly depending on tenor; SGS less frequently) and can be applied for via CPF Investment Scheme funds, SRS, or cash through local bank ATMs/brokerages.
• Full principal and coupon guarantee by the Singapore government if held to maturity.

What kind of return to actually expect

Recent auction yields have generally placed 6-month T-bills and 1-year T-bills in the 2.5%–3.5% p.a. range, with longer SGS tenors' yields shaped by the broader rate curve at auction time -- these move with each auction and should be checked against the current MAS auction results rather than assumed static.

Because T-bills and SGS trade on secondary markets, selling before maturity means your return depends on where market yields have moved since you bought -- rates up since purchase generally means a lower resale price, and vice versa. This is the key structural difference from SSB's guaranteed penalty-free exit.

The risks, plainly

• Interest rate / price risk on early exit -- sell before maturity and the price reflects current market yields, which can be below what you paid if rates have risen.
• No penalty-free redemption window -- unlike SSB, there's no built-in mechanism to exit at par before maturity.
• Reinvestment risk at maturity -- short T-bill tenors mean you'll need to redeploy the proceeds at whatever rate is available when it matures.
• Auction allocation -- competitive bids or high demand can affect how much of your application is filled at auction.

Who it tends to suit

Suits investors comfortable holding to a fixed maturity date without needing early-exit flexibility, and who want to ladder maturities or lock in a specific tenor's yield -- if flexibility to exit anytime without penalty matters more, SSB is usually the better fit for the same government-guarantee tier.

This describes how this type of product is typically used -- it isn't a recommendation for your specific situation. Talk to a licensed adviser before deciding.

Common questions

What's the difference between a T-bill and SGS bond?

T-bills are short-dated (6-month or 1-year) and sold at a discount with no coupon. SGS bonds span longer tenors (2 to 50 years) and pay a fixed coupon every six months.

Can I sell a T-bill or SGS bond before maturity?

Yes, on the secondary market, but the price you get depends on prevailing market yields at that time, unlike SSB's guaranteed par-value early redemption.

Can I buy these with CPF money?

Yes, both are eligible for purchase under the CPF Investment Scheme, subject to the usual CPFIS rules and limits.