The Bankers Association says lenders work closely with farmers and it points to the low number of mortgagee farm sales – fewer than 10 a year out of 52,000 farms across the country.
They also issued a statement, saying that bank conduct had improved over the last 10 years, with an increased focus on customer outcomes.
Ministry of Business, Innovation and Employment
In a submission, the NZ Bankers’ Association (NZBA) said it agrees and supports the objective of maintaining a sound banking system and guarding against banking crises, but argues that NZ’s major banks are already well capitalised.
Reserve Bank of New Zealand
“Our banks are profitable because they’re very efficient compared to similar banks around the world. They manage their costs very well. Another factor is that they did relatively well through the global financial crisis. None failed or were bailed out by the government, unlike in Europe and the US where they recovered their profitability more slowly from a negative base following the crisis. Our banks’ profits dropped post-crisis and recovered more quickly in parallel with other countries with stable banks, like Canada and Australia.”
Roger Beaumont said New Zealand banks were strong. “There’s a couple of reasons for that. They are well capitalised and they’re very good at managing their costs, which makes them very efficient and helps explain their returns on equity.”
Financial Markets Authority
New Zealand Bankers’ Association chief executive Roger Beaumont said it was important to compare like-for-like. “Eftpos remains an important part of card payments in New Zealand. It’s free for merchants and that impacts the overall cost to merchants for payments.”
Boyle, who reviewed the Reserve Bank’s December proposal and supporting literature and contributed to a report commissioned by the New Zealand Bankers’ Association, maintained that a full cost benefit analysis should have been done at the outset. Instead, the Reserve Bank has promised to produce one later this year.