A dispute has erupted between the Irish Association of Investment Managers (IAIM) and the National Treasury Management Agency (NTMA). The investment managers are "concerned" that competition is being restricted in the Irish Government bond market.

According to a survey released yesterday by IAIM, the six "market-makers" in bonds are effectively five. The four Irish market makers have been doing very well but only one British-based broker, UBS, has captured any market share. According to the survey the other - Credit Suisse First Boston (CSFB) - actually has a zero share among Irish institutions.

Ms Ann FitzGerald, director general of IAIM, said that her members are anxious to work with the NTMA to build a strong Government bond market which would reflect the needs of domestic and overseas investors, both now and following the introduction of monetary union.

She added, however, that IAIM members were concerned that the number of market-makers now seems to be five rather than the six originally envisaged.

"This reduces the choice available to investors; it also reduces the competition for Government issues, potentially leading to higher costs of funding," she said.

However, Mr John Corrigan, director of the NTMA, insisted that he was happy that the primary dealing system was working well. He pointed to the recent launch of a 10-year issue which was oversubscribed and to the "substantial switching" yesterday.

"This survey does not necessarily reflect a definitive summary of activity in the market. We want to await a definitive survey of the entire market before making a judgment," he said.

A spokeswoman for CSFB insisted that the institution was still making a market in Ireland. "We have no plans to change our licence as a market-maker and we are committed to the Irish market. As it is a small market, it is a niche product that plays a part in a larger product range. We are committed to the pound as it is close to the gilt and helps distinguish us from other international competitors."