The government failed to sell some €11 million worth of bonds in a €100 million issue because they were not attractive enough to investors, prominent stockbrokers have told The Times.

The Treasury said it received 1,408 applications with a total value exceeding €101 million for two issues of government bonds totalling €100 million. But only €89.8 million of the offers were acceptable as the rest were below the government's expectations. The issue had an over-allotment option for an additional €20 million which was dropped.

Contacted yesterday, stockbrokers said the failure to sell the bonds was not necessarily related to confidence. The fact that the sale came in summer could also have played a part.

The most probable reason, however, was that the government stocks were not attractive enough to investors. One stockbroker said the bonds were not attractive enough when compared to private bonds. They were being offered for redemption in 2013 at a 3.6 per cent interest rate or in 2021 at five per cent.

The stockbroker said the government would have to raise the interest rates being offered in order to compete with private bonds being offered.