The government could face a number of financial problems especially when the banks and key industry players do not purchase the bonds. Many financial institutions have been quoted saying it is very difficult to purchase the long term bonds because the market does not look to be promising in the long term. Due to the decline of business in the recent years, a lot of financial institutions are hesitating to take the move and the government will really lose out on its plans to be financially secure.

Many of the bond buyers did not purchase as expected and event her key industry players did not make any move to do so. Most of the banks claim to have very little money in the reserves and are playing it safe. The government will have to look fro means and ways to get the capital to run the country.

Reserves executives at local’s large bond buyers institutors said the bank had minimal chances to purchase the government bonds and at the same time to be in HTM category.

Reservoirs can be able to store the securities in HTM mode with 25 % net stipulates and also time deposits. The securities still remain in their current portfolio until they mature and banks should not have to worry if the level of the security at any one point go down. The government needs investors who will actively take part in this exercise to ensure the continuity of the financial sector and the growth of the company.

The government really has a lot of expenses and it needs to budget for the whole financial year before embarking on other activities. Most of the banks and treasury heads did not attend the auction that was held on August 7th. They did not want to take part in the exercise hence limiting the chances of the government to meet its financial goals. Most of them feel that the interest rates are too low and they will not be gaining much from this exercise. It is also important for the government to consider that the finance institutions are business oriented and the interest rates should be a bit higher. Most of them stated that the government bond maturity takes a lot of time and they would rather invest in other places which are faster and have higher interest rates.

Many people in the country are also taking up lots of loans and it will be had to service the bonds in the long run. There is also minimum demand for the binds and the financial institutions feel like the citizens will not actively take part in this exercise. Most of them states that there are a lot of up and down situations and they really do not think the governed will provide the needs they want in the long run. They think they are being shortchanged and there is less to gain.

The government on the other hand will need to come up with ways that will ensure they get the bonds up for sale especially to the financial institutions which play a major role in driving up the economy.