T-bill yield falls to 3.75% p.a. Did OCBC online applications drive higher demand?



By Beansprout • 13 Apr 2023 • 0 min read

The total amount of applications for the latest Singapore 6-month T-bill rose to S$12.3 billion.

Singapore T-bill auction 13 Apr

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What happened?

The cut-off yield for the latest 6-month T-bill auction (BS23107V) on 13 April 2023 fell to 3.75% p.a.

What many investors might be interested in would be whether the start of online applications using CPF funds for OCBC customers led to a significant increase in demand. 

Let’s take a look and find out what we can learn from the latest Singapore 6-month T-bill auction. 


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Source: MAS


T-bill yield falls to 3.75% p.a. What is driving the increase in demand?

#1 – Total amount of applications for T-bills rose

The total amount of applications for the latest T-bill was at S$12.3 billion, rising from S$9.6 billion in the previous auction. 

Applications rose for both competitive bids and non-competitive bids. 

The total amount of competitive bids rose to S$11.3 billion. While this is higher than the previous auction, it remains below the S$12.3 billion of competitive bids we saw as recent as in early March. 

More interestingly, the amount of non-competitive bids rose to close to S$1 billion, after having fallen to just above S$0.5 billion in the previous auction. 

This would represent the highest amount of non-competitive bids submitted since February, even as the amount of competitive bids have fallen from recent highs. 

It would seem like the start of online applications using CPF funds for OCBC customers has led to slightly more non-competitive bids being submitted. 

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#2 – Average yield for bids submitted fell

There were more mixed signals looking at the competitive bids made in the latest T-bill auction.

The median yield remained unchanged at 3.65% p.a., despite the fall in the cut-off yield.

However, the average yield fell to 3.31% p.a. from 3.43% p.a. in the previous auction. 

Hence, it would seem like there were more bids that were made at a significantly lower yield in this auction, bringing down the average yield even as the median yield has stayed the same. 

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What would Beansprout do?

We shared earlier that bond yields have been very volatile in recent weeks even as concerns about a global banking crisis have started to ease. 

In addition, there was an additional wild card in this auction from OCBC offering its customers the ability to apply for T-bills online using CPF funds. 

This has led to a few key changes we observed in this auction:

  • More non-competitive bids compared to previous auctions
  • More competitive bids made at a significantly lower yield compared to previous auction

If you missed out on your T-bill allocation, you can also consider fixed deposit accounts as a safe way to park your spare cash and earn a high interest rate. 

We were able to find a few fixed deposit accounts that offer an interest rate of close to 4% p.a., slightly higher than the cut-off yield on the latest T-bill auction. 

Also, it might be worth noting that there will be a 1-year T-bill auction on 20th April. 

Check out how you can apply for T-Bills online using CPF OA via OCBC. Or if you are a DBS customer, check out how you can apply for T-Bills using CPF OA via DBS i-banking. 

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