New Zealand banks are well positioned in the face of current international financial tensions.
“Our banks’ strength lies in the fact that they are well capitalised and regulated,” said New Zealand Bankers’ Association chief executive Sarah Mehrtens.
New Zealand banks all meet the international standards, and the Reserve Bank of New Zealand requirements which are based on these international agreements. The capital adequacy ratio mandated by the Reserve Bank is 4% for tier one and 8% for total qualifying capital. On average, New Zealand’s major banks’ capital holdings exceed the required tier one and total qualifying capital ratios by 5.96% and 4.80% respectively.
Capital adequacy rules form an important part of the regime which regulates banks. Good regulation is needed because of the importance of the banks to the economy.
“Our banking system is robust and well regulated, and served us well during the global financial crisis. Our banks did not get caught up in the debacle that many of the international banks are now facing. We need to stay focused on striking the right balance between lending and growth on the one hand, and safety on the other,” said Mehrtens.
Ministry of Consumer Affairs
Law Commission
Reserve Bank of New Zealand
The New Zealand Bankers’ Association today welcomed the government’s financial assistance for leaky homes which will provide a further option for affected home owners.
The package will offer a government contribution of 25% of the cost of approved repairs to eligible home owners to repair their homes, and home owners may be eligible for a further contribution of 25% of the cost of approved repairs from their local authority. Home owners will then need to fund the balance of the repair costs. It is expected that many home owners who are eligible for the package will do so by way of borrowing from their bank.
“Eligibility and affordability are key elements of the package,” said NZBA chief executive Sarah Mehrtens. The package announced today will go a long way towards helping in this area. Banks will work closely with affected home owners to see how they can assist. It is important to note that lending criteria conditions will still need to be met.
“Banks have for a long time been working to assist customers who own leaky homes, and what is pleasing about this package is that it does provide some property owners with a further option,” said Mehrtens. Other options that already exist include the Weathertight Homes Resolution Service.
“Customers will need to carefully consider which option best suits their needs. We encourage them to take independent legal advice because the FAP may not be appropriate for everyone,” said Mehrtens.
Member banks that have agreed to work with the government are:
- ANZ National Bank Limited
- ASB Bank Limited
- Bank of New Zealand
- The Hongkong and Shanghai Banking Corporation Limited
- Kiwibank Limited
- SBS Bank
- TSB Bank Limited
- Westpac New Zealand Limited.
Customers of other banks can also seek assistance from the Department of Building and Housing under the package.
Affected home owners are encouraged to contact the Department of Building and Housing for more information on the FAP and to determine whether they are eligible for assistance under the scheme.
The Office of the Privacy Commissioner
Ministry of Economic Development
Ministry of Economic Development
Financial Markets Authority
United States Internal Revenue Service