SSB 10-year return falls to 3.07%. Still worth applying?



By Beansprout • 05 Dec 2023 • 0 min read

The latest Singapore Savings Bond (SSB) offers a 1-year return of 3.0% and a 10-year average return of 3.07%. We find out if it is still worthwhile applying for SSBs.

ssb singapore savings bond tbill dec 2023
In this article

What happened?

There was a surge in demand for the previous issuance of Singapore Savings Bonds (SSB).

Investors hoping that the high interest rate offered by the previous SSB may be disappointed by the latest issuance. 

The latest SSB (SBJAN24 GX24010F) offers a 1-year interest rate of 3.00%, and a 10-year average interest rate of 3.07%.

The 10-year average return is significantly lower than the previous SSB, which offered a 10-year average return of 3.40%.

Let us find out if it might still be worthwhile applying for the latest SSB with the fall in interest rate. 

ssb singapore savings bond jan 2024
Source: MAS

Is it worth applying for the latest Singapore Savings Bonds (SSBs)?

#1 – 1 year and 10 year interest rate lower than previous issuance 

The 1-year interest rate on the latest SSB has fallen to 3.00% from 3.30% in the previous issuance.

The average 10-year return has also fallen to 3.07% from 3.40% in the previous issuance. 

ssb singapore savings bond jan 2024 interest rate
Source: MAS


The fall in interest rate on the latest SSB reflects the lower Singapore government bond yield in the past month, as US bond yields have fallen sharply. 

For example, the 10-year Singapore government bond yield has fallen to 2.97% on 30 November 2023 from 3.39% at the start of the month. 

If you are new to the SSB, it might be worthwhile knowing that SSB interest rates are linked to the yield of Singapore Government Securities (SGS) like the 10-year Singapore government bond. 

The decline in the 10-year average return of the SSB would hence correspond to the lower yield on the 10-year Singapore government bond in the previous month.

ssb 10-year interest rate t-bill yield
Source: Tradingview 


#2 – Allotment might be higher than previous issuance

In the previous issuance of the SSB which offered a year-to-date high 10-year average return of 3.4%, total applications surged to S$1.9 billion.

This was significantly higher than the S$1.2 billion of applications in the November issuance of the SSB. 

ssb singapore savings bond applications nov 2023

As the total amount of applications exceeded the SSBs issued, the maximum allocation for the SSB was S$20,500. This marks the lowest allotment limit so far this year.

With the lower interest rate for the latest SSB compared to the previous one, demand for the latest SSB may decline.

In the September 2023 issuance of the SSB where the 10-year average return was at 3.06%, there were just slightly over $500 million of applications. 

Likewise in the May 2023 issuance of the SSB where the 10-year average return was at 3.07%, there were close to S$700 million of applications.

In addition, it is worth noting that the amount of SSBs issued will increase further to S$1.1 billion from S$1.0 billion in the previous issuance.

ssb singapore savings bond allotment nov 2023

#3 – Singapore T-bill and fixed deposit accounts offer higher short term interest rates compared to SSB 1-year return

You might be wondering if it is more worthwhile to apply for the SSB or the T-bill, especially with the fall in interest rates for the latest SSB issuance.

In contrast, the cut-off yield on the latest 6-month Singapore T-bill bounced to 3.80% on 23 November. 

The closing yield on the Singapore 6-month T-bill remains fairly elevated at above 3.80% as of 1 December 2023. 

Hence, the T-bill offers a higher interest rate compared to the latest SSB for investors who are looking at making their savings work harder in the short-term. 

Likewise, the best 1-year fixed deposit rate of 3.60% is also higher than the 1-year interest rate on the latest SSB. 

Some savings accounts offer a higher interest rate compared to the 1-year interest rate on the SSB as well, especially as some banks have raised interest rates in December. 

What would Beansprout do? 

While the interest rate on the latest SSB has fallen compared to the previous issuance, the 10-year average return of 3.07% remains above its historical average. 

In addition, there is a possibility that the 10-year average return on the next SSB might fall further to below 3%, if the 10-year Singapore government bond yield remains at current levels for the rest of December. 

Hence, the SSB remains an attractive option if we are looking to lock in a high interest rate while having the flexibility to redeem anytime.

You can check out our SSB interest rate projection over the course of the month to decide whether to apply for the current SSB or to wait for the next issuance.

If you are looking to earn a higher interest rate in the short term, then it might be worthwhile considering other products.

For example, the recent cut-off yield on the 6-month T-bill was at 3.8%. The best 6-month and 12-month fixed deposit rates are currently at 3.6%

Otherwise, we can also consider high yield savings accounts or cash management accounts which may also offer a higher short-term interest rate compared to the SSB.

ssb singapore savings bond application dec 2023
Source: MAS

Applications for the latest issuance will close on 26th December 2023.  Learn more about how to apply for the SSB with our comprehensive guide to the SSB.

Join the Beansprout Telegram group and Facebook group to get the latest insights on Singapore bonds, stocks, REITs, and ETFs.


Should you wait for the next SSB?

Discover the projected interest rate for the next Singapore Savings Bond (SSB) issuance.

Find out now

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