The Bank of New Zealand has raised more money overseas through a covered bond issue, securing 1 billion euro.
But while BNZ says it cheaper money and helps strengthen its financial position by diversifying its funding base, but it's unlikely to mean lower rates for home and business lenders.
Covered bonds raise money against a pool of mortgages which are ring-fenced from other assets on a bank's balance sheet. Though banned in Australia, they are used widely in Europe.
European investors snapped up the seven year term bond, aided in part by the re-emergence of debt problems in Ireland.
BNZ Treasurer Tim Main says that while raising money through covered bonds is cheaper than other forms of borrowing, the cost of funds remains high and is unlikely to make any difference to mortgage rates.
The BNZ issued $425 million worth of covered bonds in June and is considering regular issues.