Bank of Ireland announced this morning that its €1.9 billion rights issue attracted a take-up rate of almost 60 per cent.

Shareholders, including the State, ordered €1.14 billion in the bank's rights issue. The bank was seeking to raise €1.9 billion through the sale of new shares to meet a capital target of €5.2 billion set following the bank stress tests in March.

Excluding the State's entitlement, existing private shareholders have subscribed for 36.8 per cent of their rights, leaving a rump of 7.7 billion shares, Davy analyst Emer Lang said in a morning note.

Bank of Ireland said its advisers will use reasonable endeavours to find buyers for the shares not taken up.

On Monday it emerged that a group of private investors had reached agreement with the Government to buy a stake of up to €1.1 billion in the bank. This development means that the lender will avoid State ownership.

The final outcome of this deal may be known as early as today, bank spokesman Dan Loughrey said  today.

Additional reporting: Bloomberg