Bank Discount Yield

The Bank Discount Yield is a method used by financial institutions when quoting prices for certain securities sold at a discount. The yield annualizes based on 360 day year and is presented as a percentage of the face value.

rbd = (D * 360) / (F * t)

  • D is Dollar Discount
  • F is Face value of the T-bill
  • t is number of remaining Days to Maturity
  • rbd is Bank Discount Yield
Please refer to the Yields worksheet in Yields.xls.

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Effective Annual Yield

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