Thursday’s Pro email:Reserve Bank Act reforms released
In the political economy and in business, Finance Minister Grant Robertson unveiled the second tranche of Reserve Bank Act reforms that will introduce deposit insurance and toughen requirements for directors and executives of all banks and deposit takers, including finance companies.
A new Deposit Takers Act would be passed next year that pulls finance companies and other non-banks into the same regime as banks, and that allows the Reserve Bank to charge them levies to recover the costs of regulation, which would include on-site regulation. See more detail via Treasury in the cabinet paper on the Deposit Takers Act reforms, and cabinet paper on the Reserve Bank Act itself.
The details that stood out for me were the role of assessing climate change as a prudential regulatory issue and the cost recovery powers of the bank, which will help fund a significant increase in the number of bank regulators. The pulling in of finance companies, and the potential for their debentures to have deposit insurance, also stood out.
There's also more detail below in Marc Daalder's report.
Watch out later today for the final main economic statistic of the year. Statistics NZ is scheduled to release September quarter GDP figures showing growth running at around 0.5 percent per quarter and over two percent for the year, largely due to population growth, construction spending and consumer spending.
We'll put out an alert to subscribers with those numbers. I'll attend the Stats NZ lockup for some end-of-year fun digging through the national accounts spreadsheets.