IRISH NATIONWIDE has raised a further €500 million on bonds falling due in 2010, bringing to €1.6 billion the amount raised by the building society under the Government bank guarantee.

The building society raised the funding as the State’s debt manager, the National Treasury Management Agency (NTMA), announced that it would sell three-year and five-year Government bonds at an auction taking place next Tuesday.

The NTMA plans to raise between €750 million and €1.5 billion at each of a series of five monthly auctions up to November.

The agency has raised €20.7 billion this year from bonds sold at auction and through banks in syndication deals, completing 85 per cent of the Government’s record funding requirements for 2009.

Irish Nationwide added the €500 million to its existing 3.5 per cent bond, which matures in 2010 before the guarantee expires.

The society raised £325 million (€372 million) selling bonds guaranteed by the Government in a deal last December, and €750 million in the sale of another Government-guaranteed bond in May.

The sale of the bond yesterday was managed by Citigroup, DZ Bank and Goldman Sachs.

The debt was priced at a yield of 175 basis points, or 1.75 percentage points, above the benchmark mid-swap rate in the market.

This is lower than the 200 basis points over the mid-swap rate paid by the society on the bond in May.

The bond will help Irish Nationwide to repay the remaining €1.5 billion in debt maturing this year. The society repaid €784 million of debt which fell due in May.

Irish Nationwide raised short-term funding of €800 million from the European Central Bank (ECB) earlier this year by pledging €1.2 billion of residential loans.

The building society set aside €464 million in 2008 to cover losses on bad loans, leaving Irish Nationwide with a pretax loss of €280 million for the year.