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Nairaland Forum / Nairaland / General / Investment / Treasury Bills In Nigeria (4608788 Views)
Fixed Deposits Or Treasury Bills, Which Is Better? / Fixed Deposit And Treasury Bill Investments From Abroad / I Need Information On Treasury Bills In Nigeria (2) (3) (4)
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Re: Treasury Bills In Nigeria by Nobody: 8:13pm On Mar 21, 2019 |
As a diaspora account holder who got tired of waiting for unsuccessful primary auctions, GTBank finally allowed me to bid in the secondary market, thanks to some of you who hinted me on how to go about it. My secondary market transaction is explained below: Principal = #3.2m, Tenor = 182days. My stated rate based on my findings on this forum yesterday(March20) = 12.2% Today, I received these 4 alerts for debited amounts: (1) N3,033,937.44 ... (2) N3,740.55 ... (3) N192.03 ... (4) N100 I understand that alerts 2-4 pertain to the deducted(whatever) fees, but my focus is on alert (1) using calculation below: I = (3,200,000 - 3,033,937.44) = N166,062.56 166,062.56 = 3,200,000 *R *182/364 R = 10.38% As a customer/investor, if my stated Tbill rate is 12.2%, is the bank legally obligated to disregard my instruction and apply whatever rate? Here in America, if the similar event takes place, the transaction would not go through, on the basis that my stated rate is>secondary market rate. OR the bank would have the decency of sending me the available secondary rates and options, and allow me to select one. So, my fellow investors, I come to you with humility for your take on this matter: Since the bank did not explicitly tell me what rate was applied on my investment, is my calculation for the rate correct? Is 10.38% too low for 182 days, compared to the recently published secondary rates by various banks? Do banks in Nigeria always disregard your instructions and apply whatever rate in the secondary auction? OR am I overreacting? I am only putting this out there to help me eliminate all vagueness and help me prepare better for future investments. As always, your input is greatly appreciated! 2 Likes 1 Share |
Re: Treasury Bills In Nigeria by elpiro: 8:35pm On Mar 21, 2019 |
Bluecollarguy:I think it is highly difficult to get 182 days at the secondary market,and your choice of words(stated rate) do not work for secondary market. You only select from the available rate. That might account for the disparity in rates. Reconfirm from your bank. 1 Like |
Re: Treasury Bills In Nigeria by Onlytru: 8:43pm On Mar 21, 2019 |
The truth is here in America, you can only go with the bank rate ... period! Rate of T-bills in America is ~3% a far cry from what you will get in Nigeria. Money mutual and fixed deposit are even worse ~1.5% Bluecollarguy: |
Re: Treasury Bills In Nigeria by TotoNaRubber: 8:45pm On Mar 21, 2019 |
The rate they sold the 182 days treasury bills to you hovers around the 10.38 percent, however the way Gtb works may be different from other banks. It looks like they sold you the treasury bills without proper information and autorisation from you. Maybe that is their mode of operation. Bluecollarguy: |
Re: Treasury Bills In Nigeria by Nobody: 9:19pm On Mar 21, 2019 |
Onlytru: I never compared Tbill rate between Nigeria and the U.S. I have only stated that a typical bank or any responsible organization would perform mandate(communicate with your clients by observing your fiduciary duties in accordance with their request). When the tbill form gives you the opportunity to state the rate you're expecting, like I said earlier, I would expect the bank to either decline my request and update me with reasons or send me the available market rates and allow me to select the one I find most suitable. Ceteris paribus, I thank you for your input... 6 Likes 1 Share |
Re: Treasury Bills In Nigeria by Nobody: 9:24pm On Mar 21, 2019 |
TotoNaRubber: Although, some hover around 12% for the same tenor but I can live with the 10.38%, besides half bread is better than none. But I wish the banks could communicate a bit better with their customers. |
Re: Treasury Bills In Nigeria by Nobody: 9:36pm On Mar 21, 2019 |
elpiro: Thanks a lot for your input. By 'stated rate,' I meant the rate I indicated on the tbill form; the rate was published yesterday wrt 182 days, so I filled the form accordingly. I'm sound on how secondary auctions work; my only challenge is that I trade from afar and the banks in Nigeria lack effective communication...they are simply negligent in nature, hence my frustration. |
Re: Treasury Bills In Nigeria by Rijo02: 9:43pm On Mar 21, 2019 |
Bluecollarguy: Your calculation is correct. The rate they gave you was less than the stated rate which is not supposed to be. The only thing I can guess is that since rates (secondary market rates) change on daily basis, the 12.2% might have dropped. However, dropping from 12.2% to 10.38% is too much. I would advise you contact your account officer who treated the TB for you. 1 Like |
Re: Treasury Bills In Nigeria by Rijo02: 9:47pm On Mar 21, 2019 |
Bluecollarguy: This is your money you are talking about with half bread is better than none "talk". Ok ooo! Maybe you are making the big monies shaa as your moniker na Bluecollarguy! I don't know the type of America why you live oo (no offense) but this dollar you converted to Naira is never picked up from the tree (unless e dey happen some places why I know no). Try and get an explanation to what happened to your TB transaction. 4 Likes |
Re: Treasury Bills In Nigeria by Nobody: 10:40pm On Mar 21, 2019 |
Rijo02: My brother, I admire your observation. I own and manage a small construction co. here with small investment in Real Estate, hence my name 'bluecollarguy.'...I hold a Business Degree from a prestigious University here sha, but I chose the blue collar path because ee dey make sense pass to dey wear suit and tie. My plan na to retire early, liquidate my business and come back to Nigeria, that's why I invest heavily in Tbill. And of course I was expecting at least N190K from my N3.2m investment but I'll manage the N160K. 190K-160K = 30K = $83... life goes on! Nigeria wahala too much, but I'll talk to my account officer as you advised. God bless! 5 Likes 2 Shares |
Re: Treasury Bills In Nigeria by ahiboilandgas: 10:49pm On Mar 21, 2019 |
Bluecollarguy:rate changes constantly on the secondary markets ...tell them to send u your certificate 2 Likes |
Re: Treasury Bills In Nigeria by luvly4luv(m): 12:32am On Mar 22, 2019 |
Francisvis:1000 @365 |
Re: Treasury Bills In Nigeria by HeliosHay(m): 12:38am On Mar 22, 2019 |
Bluecollarguy: Out of curiosity, do you intend on repatriating your profits from TB to the USA or leaving it in Nigeria? I also want to start investing in TB (live in london), but I'm scared of the exchange rate going against me and erasing any gains I make in TB when I want to repatriate my profits back to UK. It's not like people buy currency futures to lock in their exchange rate. |
Re: Treasury Bills In Nigeria by Yankee101: 4:15am On Mar 22, 2019 |
Bluecollarguy: Next time send an email requesting for secondary rates, (your acct officer or the headoffice) reply to their mail showing the rates with your instruction. That way it's binding. 3 Likes |
Re: Treasury Bills In Nigeria by freeman67: 7:34am On Mar 22, 2019 |
Bluecollarguy: Yes the truth is that under normal circumstance that is suppose to have communicated back with you if what they have is different from what you requested. Apparently, situation with Nigerian banks aren't normal because what was given to you does not tally with what you requested for so to know the exact rate and tenure given to you just request for proof of investment /certificate. With that you would be sure of your terms of your transaction. |
Re: Treasury Bills In Nigeria by ahiboilandgas: 7:42am On Mar 22, 2019 |
HeliosHay:why not buy euro bond ....any devalution can wipe out your entire gain over years plus loss the purchashing power of the capital....imaging converting 20000 pounds in 2015 (5 m naira) to buy tb by 2019 the total investment and profit is around 7,500,000 (tb can go as low at 10 percent ) covert this to pounds at 470 that around 16000 pounds so u lost 4000 pounds ..this happen and will surely happen again in Nigeria with out cut and join economy ....when we can tell but the sign are there....unless u are planing to return to Nigeria and all your expense will be naira ......at least a bottle of Pepsi is still 100 naira from 2015 to date ,..... 2 Likes |
Re: Treasury Bills In Nigeria by Francisvis(m): 7:51am On Mar 22, 2019 |
Contact me for your cash deposit and payment to any us bank account and China payments |
Re: Treasury Bills In Nigeria by ahiboilandgas: 7:58am On Mar 22, 2019 |
I really don't encourage persons converting dollars to invest in Nigeria treasury bills ..unless at the short end max 3 moths then constantly converting the interest back to dollars even at this the main capital is at huge risk ...money is not in number but it purchasing abilities so if u intend to live abroad this not the way to go .....the cbn is till funding the markets with 200 million weekly ,a new cbn governor is coming ....covegence of rate is a most for sustainable forex markets and inflow ....all this economic paramater are too much for a small investor .....from 1992 to 2019 it happen over 15 times 2 Likes |
Re: Treasury Bills In Nigeria by dipoolowoo: 8:56am On Mar 22, 2019 |
CBN Drops One-Year OMO Bill Rate to 13.04% https://businesspost.ng/2019/03/22/cbn-drops-one-year-omo-bill-rate-to-13-04/ |
Re: Treasury Bills In Nigeria by Nobody: 9:32am On Mar 22, 2019 |
ahiboilandgas: Thank You, But the Foreign Institutional BIG GUY (hedge fund / investment firm ) brought in $3 B after election and it all went into FIXED INCOME.( T.BILL& BOND). It a game they play every year ONCE they r confident dere is no devaluation.. Imagine 15% for the last 2years in nigeria , dat 30% return in 24mths...but in usa dat barely 7% in 24mths . so the diffrence is clear. i will play d game as well... Emergin market is risky.but the reward is worth it. and some r able to handle/navigate the risk. 3 Likes |
Re: Treasury Bills In Nigeria by ahiboilandgas: 10:24am On Mar 22, 2019 |
tritritri:they have risk expert on their payroll and they are not immune to lost...they got their finger burnt in 2015 ....example Egypt air has 500 m in their ticket sale account in 2015 that was around 2.5 m dollars and their global accounts will read 2.5 m dollars as cash balance but they couldn't remit the money cos cbn was only offering 100k dollars monthly to each airline ....then if the Nigerian accountant had to buy 1 million dollars @400 and the remaining 100m at 305 total now is 1.3 million dollars ...lost is 1.2 million dollars (all their 3 years work)wipe out ... 1 Like |
Re: Treasury Bills In Nigeria by Just2endowed2(m): 10:26am On Mar 22, 2019 |
ahiboilandgas: how do one buy this eurobond in nigeria? and whats the minimum investment. |
Re: Treasury Bills In Nigeria by ahiboilandgas: 10:27am On Mar 22, 2019 |
The foriegn player remit their money at 305 back to their country while an individual player will buy at 360 .....that why they take more risk |
Re: Treasury Bills In Nigeria by lancee(m): 11:28am On Mar 22, 2019 |
ahiboilandgas: I doubt it sir , pls if u have proof I will appreciate I only know of the I & E Fx window that was created for them April 2017 cos of forex shortages ..which they come in and change their money and buy back when leaving ..Am tryin to learn sir , need more info as per them coming in @ 360 then repatriate their money @ 305 2 Likes 1 Share |
Re: Treasury Bills In Nigeria by 234ng44uk(m): 11:41am On Mar 22, 2019 |
ahiboilandgas: I doubt the credibility of this information. If that were the case, then Nigeria will be the number one investment destination in the world where our national bank would become their bureau de change 1 Like |
Re: Treasury Bills In Nigeria by ahiboilandgas: 12:09pm On Mar 22, 2019 |
234ng44uk:u doubt or u don't know Nigeria well |
Re: Treasury Bills In Nigeria by ahiboilandgas: 12:13pm On Mar 22, 2019 |
lancee:who get the dollar at 305 ![]() .. |
Re: Treasury Bills In Nigeria by HeliosHay(m): 2:59pm On Mar 22, 2019 |
ahiboilandgas: Thanks man. I'll look into this Eurobond. Seems like a better alternative |
Re: Treasury Bills In Nigeria by Omonigeriarere: 3:17pm On Mar 22, 2019 |
Bluecollarguy: Why going for such rate when a predetermined rates on I-Invest is better? U need to wake up |
Re: Treasury Bills In Nigeria by GonFreecss1: 3:28pm On Mar 22, 2019 |
Omonigeriarere: Some people here discouraged others from using mobile apps. Lol! Maybe that is why... |
Re: Treasury Bills In Nigeria by ahiboilandgas: 4:12pm On Mar 22, 2019 |
234ng44uk:that why it the number 1 investment destination in Africa |
Re: Treasury Bills In Nigeria by ahiboilandgas: 4:24pm On Mar 22, 2019 |
Company A from country A come to Nigeria to set up a manufacturing company in agabara but require dollar to import raw materials and the cbn gives company A at 305 ....then company A parent company located in country A set up a money market investment firm AA the wired 10 million dollars to buy treasury bills at 14.5 then it converted at 355 at maturity AA has 4 bn naira in it NIgeria account ....the Company AA wires the nair a to company A it sister that manufacture in Nigeria the Company A write to cbn ot requires 4 bn at 305 to import machinery from country A cbn collect the naira 4 bn and give company A 13 million dollars wired to country AA parent company ....profit 3 million dollars in 1 year ......hmm cbn examiner.....dash him 100 k dollar he perfect the papers.....this what sunusi lamido was complaining about u can become a billionaire over night in Nigeria with just phone call... 4 Likes 2 Shares |
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