THE GOVERNMENT is seeking to raise between €3 billion and €5 billion from investors in what is likely to be the only syndicated sale of a benchmark Irish bond this year.

The bond, which matures in October 2020, drew subscriptions of €7 billion when the order book was opened to investors yesterday.

The debt raising by the National Treasury Management Agency (NTMA) could raise up to a quarter of the State’s €20 billion borrowing needs for this year.

The price to be paid to investors and the final amount raised will be set today. The issue was guided at a price of 145 to 150 basis points over the midswaps rate, which is the European reference point for pricing debt. This compares with 215 basis points over midswaps when the agency raised €6 billion on a 10-year bond last June.

Market analysts said that the NTMA’s debt issue was expected to be the only syndicated benchmark bond to be placed by the agency this year as the NTMA has said it will hold 11 monthly auctions this year, starting next Tuesday, aimed at raising €1 billion to €1.5 billion at each auction.

This should, with a €5 billion syndicated bond, meet the State’s borrowing requirements for 2010.

The primary dealers on the bond issue are Barclays, Calyon, Citi, Deutsche, UBS and Davy, the only Irish dealer.

Oliver Whelan, the NTMA’s director of funding and debt management, said it hoped to raise between €3 billion and €5 billion.

Mr Whelan said that the agency should reach its annual target with the bond and the monthly auctions and therefore was unlikely to return to the market this year with another syndicated bond “unless a golden opportunity arose”.

The spread between the cost of 10-year Irish Government debt and that of Germany rose slightly yesterday as European sovereign debt markets weakened on concerns about Greece’s finances.