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Banking industry welcomes conclusion to RBNZ capital review process

Contributor:
Fuseworks Media
Fuseworks Media

The New Zealand Bankers’ Association today welcomed the conclusion of the Reserve Bank’s review of how much capital New Zealand’s banks should hold.

"Today’s announcement provides our banks with certainty on the amount and type of capital they will need to hold in future, and brings an end to a robust consultation," says New Zealand Bankers’ Association chief executive Roger Beaumont.

"We recognise that these decisions conclude the consultation and our banks will work constructively with the Reserve Bank to implement the new capital requirements.

"We are pleased the Reserve Bank has engaged with a wide range of stakeholders and made some changes to its original proposal. In particular we acknowledge the longer implementation timeframe of seven years instead of five, which commences in July 2020.

"We’re also pleased to see a recognition of the differences between the larger and the smaller banks.

"Today’s announcement will have an economic impact and each bank will now consider the implications for their business and customers, and will be developing their own commercial response.

"Our banks will continue to work closely with the Reserve Bank on the detail of today’s decisions to ensure a smooth implementation.

"We support a strong and stable banking system that can withstand significant shocks.

"We also acknowledge the Reserve Bank for encouraging a valuable public debate on this issue and for responding to feedback," Beaumont says.

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