While it could be argued that the Commonwealth Bank took advantage of a relatively buoyant mood in financial markets last Monday, it can also be said that the bank has now proved that there is significant demand, in sizeable volume, for bonds without a government guarantee. CBA remains the only one of the big four to issue non-guaranteed bonds in the domestic market, consistently passing on the 70 basis points guarantee fee to investors.Just after the government guarantee became available the CBA issued $500 million of three-year floating rate notes at 160 bps over the bank bill rate. At the same time it issued $760 million of guaranteed three-year FRNs at 90 bps over. In February, the bank issued a total of $400 million of three-year FRNs at 130 bps over bank bills, by which time the benchmark for guaranteed three-year bonds had reduced to 60 bps. Last Monday's issue comprised $550 million of FRNs and $650 million of fixed-rate bonds with a 17 April 2012 maturity. Again, the bonds priced at 130 bps over swap/bank bills.To date the other three big banks have insisted that there is insufficient demand to issue bonds without a government guarantee in the domestic market. However, it appears they are not doing themselves or investors a favour. Investors are missing out on an additional 70 bps of yield and the banks are leaving themselves beholden to a government that will continue to use its guarantee of the bank's bonds as a lever to bend the banks to its will.