Otago University chief operating officer John Patrick told the Otago Daily Times yesterday there were no plans to follow Canterbury at this stage.
"However, if we required to raise significant funds, we would look at it as an option."
Canterbury University yesterday launched a $100 million bond issue - $50 million, with the capacity to accept $50 million of oversubscriptions.
Investors would be paid 7.25% interest for five years, with the rate then reset for a further five years.
Investors would be entitled to full repayment when the bonds reached maturity in 2019.
Craigs Investment Partners broker Peter McIntyre said Canterbury was very innovative to issue such debt, but he did have some concerns.
Investors were not putting their money into a state-owned enterprises, such as Meridian Energy, and the risks included how many people would want their money back at the end of the 10 years and how the university would find that money and fund the repayment.
The interest margin was attractive and it was senior debt, ranking with the banks.
However, the bonds did not have a credit rating and that could hinder the take-up, he said.
"Canterbury investors have just done a lot of their money through Pyne Gould Corporation. The success of this issue will depend on the support from the leafy suburbs of Fendalton."
Mr McIntyre believed other tertiary institutions would look carefully at the success or otherwise of the issue and might consider issuing similar sorts of bonds.
Canterbury vice-chancellor Rod Carr said in the next 10 years, the university planned to invest as much as $500 million in developments.
The university had the ability to fund around $350 million for these from its operating profit.
The $100 million from the bonds would be used to supplement the gap in funding.
