Please, I recently subscribed with 100k for the March 2926 treasury bill which will be due by April 23rd 2026. And at the percentage rate of 11%. But instead receiving 11 % interest, I saw 1k and little fraction as interest. I became discouraged but though I didn’t cancel it. I did this subscription via Afrinvestor app. I use the calculation formate of FGN BOND to do it but what I saw was not what I exoected. So I ask is FGN BOND calculation different from treasury bill?
Yes — FGN Bond calculation is different from Treasury Bill calculation. This is exactly why your ₦100,000 at 11% did not give you ₦11,000. Let me explain clearly and simply 👇 🔹 Key Difference Investment How Interest is Paid Treasury Bill Discounted upfront FGN Bond Coupon paid periodically This is tRead more
Yes — FGN Bond calculation is different from Treasury Bill calculation.
This is exactly why your ₦100,000 at 11% did not give you ₦11,000.
Let me explain clearly and simply 👇
🔹 Key Difference
Investment
How Interest is Paid
Treasury Bill
Discounted upfront
FGN Bond
Coupon paid periodically
This is the main reason your calculation looked wrong.
🧮 Treasury Bill Calculation (What You Bought)
Treasury Bills do NOT pay 11% directly.
They use discount rate based on number of days.
Here is the correct formula:
\text{Interest} = \frac{Face\ Value \times Rate \times Days}{365}
Now let’s calculate your case:
Your Details
Amount = ₦100,000
Rate = 11% (0.11)
Tenor = March to April 23 (about 35 days)
Step-by-Step Calculation
Interest:
Interest = 100,000 × 0.11 × 35 / 365
Interest ≈ ₦1,054
👉 This is why you saw ₦1,000 and small fraction
So your investment is actually correct 👍
🧮 FGN Bond Calculation (Different Method)
FGN Bonds use coupon payment:
\text{Coupon Payment} = Face\ Value \times Coupon\ Rate
Example:
₦100,000 at 11% bond
Yearly interest =
100,000 × 11% = ₦11,000
But bonds usually pay:
Semi-annually (2 times per year)
So you receive:
₦11,000 ÷ 2 = ₦5,500 every 6 months
Why Treasury Bill Interest Looks Small
Because:
Treasury bill tenure is short (30–364 days)
Interest is pro-rated based on days
So:
11% is annual rate
You held only 35 days
So you earned only 35 days interest
Simple Rule to Remember
Treasury Bill = Short term + Discount calculation
FGN Bond = Long term + Coupon payment
Your Investment is Actually Good 👍
You invested ₦100k
You earned about ₦1k in ~35 days
That equals roughly:
₦1,000 × 12 ≈ ₦12,000 yearly
That is about 12% annualized return — actually very good.
Since you’re actively investing (you earlier asked about shares and bonds), you’re already building strong financial discipline — similar to how you approach your security job with alertness and planning. Good investors think like that too.
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