How To Calculate Treasury Bills in Nigeria

Almost everybody look forward to investing their money so as to make gains instead of leaving it an account, doing nothing with it. One of the surest way to invest money is through treasury bills. Treasury bills are short-term investment securities issued by governments to finance national borrowing requirements. A feature of treasury bills is that it is a tenured investment account with a specific amount invested at an agreed interest rate and tenure. Its at the end of the agreed period, the investment can either be re-invested or returned to you with the interest based on your instruction.

treasury bills in nigeria


Treasury bills are also referred to as T’bills. This is considered as the safest form of investment one can market. This is because your money will always be paid to you with the agreed interest no matter what, even though there is a change of government. Treasury bills are issued by the Federal government through the Central Bank of Nigeria to short term funding for the government. Banks, firms, financial institutions and individuals can purchase these particular bonds.

Treasury bills are usually issued by the Central Bank of Nigeria for 91 days, 182 days and 364 days at a primary market auction and investors come to place their bids to buy them. A good benefit of treasury bills is that they are very liquid. They can easily be converted to cash.  One can decide to collect his/her money any time, but, the investment will be discounted. Also no transaction cost is charged, unlike other forms of investment. However, a downside to investing in treasury bills is that the interest rates which are paid on them are almost always lower than other investment options in the market.

Investing in treasury bills in Nigeria is very simple. However, there is a need to familiarize oneself with the venture before proceeding to invest. It is important to note that interest rate, also called stop rate is the bid rate you will receive for the money you wish to invest. An interest rate could be 5%, 10%, or 15%, depending on the bond issued by the Central Bank of Nigeria.

Treasury bills purchased as bonds do not have fixed stop/interest rate. The Central Bank of Nigeria and the demand for the treasury bills determine the stop rate. Therefore, if you want to know how much to expect at maturity, then you must be able to calculate your return on investment. This will be further explained with examples.


For instance, if you buy a 364-day treasury bill worth ₦500 000 from your bank or a stockbroker at an interest rate of 10%, you can calculate treasury bills (upfront payment) using the formula below:

Interest = Principal x Time x Rate/100

Principal = ₦500,000

Time = 364 days (1 year)

Rate = 10/100

₦500,000 x 1 x 10/100 = ₦50,000

This result, ₦50,000 is what you will get paid at the start of the investment and the remaining ₦450,000 is remitted to the Central Bank of Nigeria. Your investment is ₦450,000 and not ₦500,000 because you get ₦50,000 back.

Therefore, we will further calculate your actual rate of return. This can be calculated with the following;

Rate = (Interest x 100)/ (Principal x Time)

(₦50,000 x 100)/ (₦450,000 x 1) = 11.1%

Finally, this is how you calculate your interest rates on treasury bills in Nigeria. I hope this article was helpful.


As noted earlier, treasury bills are mostly sold via a bi-weekly auction performed and announced only by the Central Bank of Nigeria. The average minimum bid is normally selected after buyers are given a fair chance to quote bids. Most times, the CBN announces this on national dailies, or on their website. You can ask your bank account officer to inform you when sale of treasury bills starts.


In the past, for just a minimum of ₦10,000, you could buy treasury bills in multiples of ₦1,000. It was then increased in 2017 to ₦50,000,000. Through bank apps, the minimum amount to start the application is ₦100,000.


To purchase treasury bills, you can do so via your Bank’s mobile app i.e if they have the option there or you might have to visit your bank and request for a form. Its in this form that you will fill your accurate personal information plus the amount to buy and bid rate.

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Oluchi Chukwu

Oluchi is a seasoned Information blogger, content developer and the editor of Nigerian Queries. She is a tech enthusiast who loves reading, writing and research

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