BANK OF Ireland has raised a further €1 billion from the sale of a Government-guaranteed bond, bringing to €3.1 billion the total amount raised by the lender under the bank guarantee scheme.

The six Irish-owned guaranteed banks and building societies have now raised a total of €10 billion in the bond markets using the Government guarantee.

Bank of Ireland paid a price of 185 basis points, or 1.85 of a percentage point, above the benchmark midswap rate, the measure which sets borrowing costs on bonds.

This compares with 65 basis points over the benchmark paid on the €2 billion raised by the bank last November, but it is lower than the 200 basis points the bank’s bonds traded at a month ago.

The bank raised a further €100 million privately on the back of the bond sale last November.

One Dublin bond analyst said that the fundraising was “another sign of the liquidity in the market” and that investors were “more comfortable with the guarantee”.