The New Zealand Earthquake Commission (EQC) is to sell $NZ3.1 billion ($2.4 billion) of NZ Government bonds to the Debt Management Office.

The move comes as the net cost of the Christchurch earthquake has been revised again to $NZ7.07 billion ($5.56 billion).

This increased estimate has lead to the EQC disposing of liquid assets, such as the government bonds, where there is a ready market delivering good returns.

The EQC had about $NZ4.5 billion ($3.54 billion) of investments with $NZ523 million ($411.5 million) in overseas equities and $NZ676 million ($532 million) of managed funds in overseas investments.

According to the EQC’s budget forecasts for the current financial year, the Natural Disaster Fund will have a closing balance of $NZ3.4 billion ($2.6 billion).

It was predicted to have earned more than $NZ200 million ($157 million) from its investments during this financial year although this will now be less with the bond sale.

There will be further investment sales to cover the cost of the earthquake until the fund is wound up.

The New Zealand Government estimates the shortfall in the fund when all claims have been dealt with will not exceed $NZ500 million ($393 million).