Broking firms have made bids of almost $12 billion for the Abbott government's sale of health insurer Medibank Private.
Finance Minister Mathias Cormann says this is more than double the shares on offer based on a capped retail price of $2 per share.
He said eligible Australian and New Zealand brokers who bid for a firm allocation on behalf of their retail clients have been allocated $1.5 billion of shares.
"Broker firm allocations have already been significantly scaled back due to the exceptionally strong demand for Medibank Private shares during this phase of the offer," Senator Cormann said in a statement on Thursday.
He said this is "appropriate and necessary" to ensure equitable access by Medibank Private policy holders and the general public to the share offer.
Australian broker clients can still apply through the general public offer or, if eligible, the policy holder offer or employee offer, which remains open until November 14.
Senator Cormann said no decisions will be made on the overall split of share allocations between the retail and institutional offers, nor between domestic and international institutions, until the share offer has been completed.
The final price for shares and the number of shares investors will receive based on the allocation criteria is expected to be announced by November 25.
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