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Reserve Bank of New Zealand News Releases

Reserve Bank of New Zealand News Releases

The Reserve Bank of New Zealand is New Zealand’s central bank. We promote a sound and dynamic monetary and financial system.

Articles by Reserve Bank of New Zealand News Releases

Stress test reinforces importance of bank capital

10 days ago

Release date
17 September 2020

The Reserve Bank’s – Te Pūtea Matua – latest stress test of New Zealand’s banks illustrates the benefit and necessity of shoring up bank capital in the good times to provide resilience. The COVID-19 pandemic has demonstrated that large shocks can occur with very little warning.
“The onset of the COVID-19 pandemic provides a stark reminder to us all of the importance of being prepared for the unexpected, especially when you are a systemically important bank at the core of New Zealand’s financial system. The more capital a bank holds, the better it can weather economic storms and meet customer needs during tough times like now.” Deputy Governor Geoff Bascand says.
“Our stress test assess the impact of significant, hypothetical,

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Work on Insurance Act Review resumes

13 days ago

Release date
14 September 2020

The Reserve Bank – Te Pūtea Matua will be relaunching the review of the Insurance (Prudential Supervision) Act (IPSA) in October.
The review began with an industry consultation in 2017 and was set to resume in March this year, but was delayed in-line with the regulatory relief implemented to free up the Reserve Bank and industry participants to support our economy and tackle the challenges created by COVID-19.
“Maintaining a sound and efficient insurance sector is important for New Zealand,” Deputy Governor and General Manager of Financial Stability Geoff Bascand says.
“Customers expect to be able to insure their homes and possessions and obtain life and disability insurance, and businesses utilise a range of insurance products

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Confidence in a world of uncertainty

21 days ago

Release date
06 September 2020

During this unsettling time of COVID-19 public confidence in our financial system is critical. This is why the Reserve Bank of New Zealand – Te Pūtea Matua – takes its mandate of promoting monetary and financial stability as sacrosanct. We rely heavily on our core values of integrity, innovation and inclusion to succeed. These values are our bedrock which ensured we were prepared for the challenges COVID threw at us, and will continue to allow us to respond quickly as the situation evolves.
Our Monetary Policy Committee agreed that a ‘least regrets’ policy response was to ease monetary conditions significantly. We determined that it is better to risk doing too much too soon, rather than too little too late.
We have cut the

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Same objectives, different challenges

25 days ago

Release date
02 September 2020

The Reserve Bank’s goals of monetary and financial stability, and team values and capabilities, put it in good stead to manage the evolving economic consequences of the global COVID-19 pandemic.
“There is no precedent for an economic shock of this nature in peoples’ living memory. It is assuring that during such uncertain times people can have confidence in New Zealand’s monetary and financial system,” said Reserve Bank Governor Adrian Orr in a speech delivered to the Victoria University School of Government and Policy Studies.
“Our policy goals are highly relevant, and our strategies to achieve them will evolve with the circumstances.”
“Our key early actions included a significant easing in the Official Cash Rate (OCR), the

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Banks and NBDT's under COVID-19 Alert Level 3 – August 2020

August 24, 2020

Release date
24 August 2020

The Ministry of Health have granted an exemption to enable registered banks and licensed non-bank deposit takers (NBDTs) to carry out critical financial services at Alert Level 3. https://gazette.govt.nz/notice/id/2020-go3923
The exemption is subject to the following conditions:
Interactions with customers should be via remote means wherever possible;
Face-to-face customer interaction continues to be permitted for financial services only;
Over-the-counter transactions to be completed at distances of over one metre and only if increased hygiene in these areas can be ensured;
For transactions in which require face-to-face engagement but cannot take place over the counter, increased hygiene must be ensured;
Registered

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RBNZ to lead Asia-Pacific Central Banks working group

August 20, 2020

Release date
21 August 2020

The Reserve Bank of New Zealand has been appointed chair of an international central bank working group for the next two years.
In its virtual meeting on Wednesday, the Executives’ Meeting of East Asia-Pacific Central Banks (EMEAP) announced that the Reserve Bank has been appointed chair of the EMEAP Working Group on Payments and Market Infrastructures (WGPMI).
EMEAP is a cooperative organisation of central banks and monetary authorities from Australia, China, Hong Kong, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore and Thailand.
Reserve Bank Deputy Governor Geoff Bascand said the appointment is very much aligned with the Reserve Bank’s expanding regulatory and operational focus on financial

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Changes to Term Lending Facility

August 20, 2020

Release date
20 August 2020

In conjunction with the Government’s review of the Business Finance Guarantee Scheme, the Reserve Bank today outlined the revised operational details of the Term Lending Facility (TLF).
Under the revised facility, the Reserve Bank will continue to offer to lend funds to banks at the Official Cash Rate, however the term has been extended to five years from three years.
The new facility will be available to use from 26 August and now runs through to 1 February 2021. The table below shows the TLF schedule dates.
More details about the TLF can be found in the Domestic Markets markets release – Reserve Bank outlines details of revised Term Lending Facility
TLF Schedule (dates are inclusive)

Offering 10.00am-12.00pm and 1.00pm-3.00pm

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The Reserve Bank's balance sheet set to expand further in response to COVID-19

August 19, 2020

Release date
20 August 2020

The Reserve Bank’s balance sheet will continue to grow as it supports the economy and financial system in response to the COVID-19 pandemic.
In a speech to the ANZ-KangaNews New Zealand Capital Markets Forum, Assistant Governor Christian Hawkesby outlined how the Bank is using its balance sheet to achieve its monetary policy mandate of low and stable inflation and full employment, as well as supporting financial stability.
The Bank’s balance sheet has more than doubled since January to about $60 billion.
“In an environment of where the Official Cash Rate (OCR) is near its lower limits, the size and composition of our balance will inevitably become a more active tool for our monetary policy decisions,” Mr Hawkesby said.
The COVID-19

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Reserve Bank extending mortgage deferral scheme

August 17, 2020

Release date
17 August 2020

The Reserve Bank – Te Pūtea Matua – is announcing an extension of the regulatory guidance for the mortgage deferrals programme to help customers in need.
Since the original guidance was issued in March, many lenders have been supporting customers affected financially by COVID-19. The regulatory guidance means banks can continue to offer temporary mortgage deferrals to their customers, without those loans being viewed as being in default, Deputy Governor and General Manager of Financial Stability Geoff Bascand says.
The extension takes effect from when the existing guidance expires on 27 September and will apply until 31 March 2021, at which point the usual treatment will resume. Banks will still be able to offer deferrals to

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Further easing in monetary policy delivered

August 12, 2020

Tēnā koutou katoa, welcome all.
The Monetary Policy Committee agreed to expand the Large Scale Asset Purchase (LSAP) programme up to $100 billion so as to further lower retail interest rates in order to achieve its remit. The eligible assets remain the same and the Official Cash Rate (OCR) is being held at 0.25 percent in accordance with the guidance issued on 16 March.
Reflecting a possible need for further monetary stimulus, the Committee also agreed that a package of additional monetary instruments must remain in active preparation. The deployment of such tools will depend on the outlook for inflation and employment. The package of further instruments includes a negative OCR supported by funding retail banks directly at near-OCR (a Funding for Lending Programme). Purchases of foreign

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New Assistant Governor to join Reserve Bank of New Zealand

August 11, 2020

Release date
11 August 2020

The Reserve Bank today announced that Mrs Juliet Tainui-Hernandez has accepted the position of Assistant Governor and General Manager of Transformation and People.
Mrs Tainui-Hernandez will complete the Bank’s Senior Leadership Team and be based in the Auckland office.
Her role involves being responsible for leading the Bank’s Transformation and People Group, overseeing the development of the Auckland office and relationships, and contributing to the Senior Leadership Team’s whole of Bank decision making and operations.
Juliet is of Ngāi Tahu and Whakatohea descent. She has worked with local Iwi and with a large New Zealand law firm before commencing her international career. Juliet has since worked in Australia, Hong Kong, and

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Transparency and disclosure critical to COVID-19 response

August 3, 2020

Release date
03 August 2020

Transparency and clear disclosure of actions and policies have been key to the COVID-19 response, Reserve Bank Head of Financial System Policy and Analysis Toby Fiennes said delivering a speech in Wellington today.
Market discipline is one of the three pillars in the Reserve Bank’s regulatory framework. It relies on transparency through good disclosure and reporting from regulated institutions and clear communication from us as the steward of the financial system, Mr Fiennes said.
“Whether you’re making a financial or business decision, clear, concise and up-to-date information is crucial to making informed decisions. As well as helping banks to keep focussed on their customers during the initial response to COVID-19, we’ve been

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Banking post-COVID-19 requires a long-term view

July 30, 2020

Release date
31 July 2020

How the banking sector chooses to respond to the significant impact caused by the COVID-19 pandemic will have a major influence on how the financial system evolves over the next decade.
The pandemic has posed significant challenges to both our economy and the financial system as a whole. We expect it will take some time before we see a full recovery, Reserve Bank – Te Pūtea Matua Deputy Governor and General Manager of Financial Stability Geoff Bascand said in a speech delivered today.
“New Zealand’s financial sector has proved resilient to the dual health and economic shocks and indeed, supported the business and household sectors through strong business continuity arrangements, the accommodation of many customers through the

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Reserve Bank paper finds unemployment in one region can affect another

July 29, 2020

Release date
29 July 2020

Studying changes in job levels in the Auckland and Waikato regions could provide a more accurate indicator of where the country’s labour market is heading, according to a new Reserve Bank paper.
The Analytical Note Regional Labour Market Spillovers examined regional labour markets and how unemployment in one region could spill over and influence joblessness in other regions.
“By doing this we can identify which regions have the greatest or smallest impact on other regions and identify which ones give us an early heads up about where national unemployment is heading,” Reserve Bank analyst and the paper’s author Cameron Haworth said.
The report found rising unemployment in Auckland and Waikato had the most influence on unemployment

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Introduction of Bill marks exciting new phase for Te Pūtea Matua

July 28, 2020

Release date
28 July 2020

The Reserve Bank of New Zealand – Te Pūtea Matua – has welcomed the introduction of a Bill that sets out the organisation’s future institutional and governance arrangements. The Reserve Bank of New Zealand Bill was introduced to Parliament today by Minister of Finance Grant Robertson.
This is the first of two bills resulting from the Phase 2 review of the Reserve Bank of New Zealand Act 1989. As part of the broad-ranging review, the Government has decided that the current Act will be replaced with two new pieces of legislation – the ‘Reserve Bank Act’ and a ‘Deposit Takers Act’.
The Bill focuses on reforming the overall institutional, governance, accountability, and funding arrangements of the Bank. It implements decisions taken by

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Common global shock but diverging economic outcomes

July 25, 2020

Release date
26 July 2020

Reserve Bank of New Zealand Governor Adrian Orr
As New Zealand’s Reserve Bank we hear directly ‘from the horse’s mouth’ what our global colleagues are experiencing and doing.
From our most recent interactions it is clear that the common and (almost) simultaneous COVID-19 health shock is impacting nations in similar ways, but the policy reactions and outlooks ahead vary greatly. The differences are in large part explained by the initial health of their economy, the underlying drivers of economic activity, and the degree of success in containing COVID-19.
The more robust an economy was when first impacted by the pandemic, the more options and flexibility its local policymakers had to respond. Robust is generally considered as recent

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Reserve Bank releases Credit Conditions Survey for June 2020

July 14, 2020

Release date
14 July 2020

The Reserve Bank is today releasing the results of its Credit Conditions Survey for June 2020.
The March Survey was collected in early March and thus reflects the views of respondents prior to the announcement of the COVID-19 alert level system and nationwide lockdown. The Reserve Bank therefore decided to conduct an interim Credit Conditions Survey to understand how domestic credit conditions have changed post-lockdown. We do not intend to turn this into a quarterly survey on an ongoing basis.
The biannual Credit Conditions Survey asks banks qualitative questions about changes in credit conditions in bank lending markets. Banks provide separate responses for household, small and medium enterprise, corporate, commercial property and

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Leadership appointments in Reserve Bank's Money Group

July 6, 2020

Release date
07 July 2020

Two appointments to senior leadership roles in the Reserve Bank’s Money Group show the Bank’s commitment to developing and preparing for the future of physical and electronic payments, Assistant Governor Christian Hawkesby says.
Ian Woolford has been appointed the Reserve Bank’s Head of Money and Cash, and Steve Gordon will head a new Payment Services Department.
Mr Hawkesby says both new roles stem from growth and developments within the Reserve Bank’s Banking Department.
"Two major strategic projects – the Payment Systems Replacement, and the Future of Cash – have resulted in new responsibilities and considerable advancements in thinking and future direction for physical and electronic payments,” he says.
“Te Pūtea Matua, the

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Monetary Policy dates for 2021

June 29, 2020

Release date
30 June 2020

The Reserve Bank today announced the remaining 2021 dates for releasing its quarterly Monetary Policy Statements (MPS) and the recently renamed Monetary Policy Review (MPR) decisions. This covers the period from August to November 2021.
The release dates for 2020 remain unchanged.
Announcements will be made as usual at 2pm for MPS and MPR reviews. These will be published on the Reserve Bank website.
Media conferences will be held following the release of each MPS at 3pm. They will be live-streamed on the Reserve Bank’s website.
The Reserve Bank reserves the right to make changes to this schedule, if required. In such an event, the markets and the media would be given as much notice as possible.
The remaining 2020 dates and full 2021

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Reserve Bank embraces kaitiaki role in outlining its priorities

June 29, 2020

Release date
29 June 2020

Reserve Bank of New Zealand – Te Pūtea Matua’s Statement of Intent (SOI) for 2020-2023, released today, highlights the Bank’s focus and commitment as the kaitiaki (guardians) of New Zealand’s financial system.
Reserve Bank Governor Adrian Orr said the Bank is committed to meeting the challenges and risks that are ever present in the financial system, and making the most of opportunities for the New Zealand economy.
The SOI outlines how the Reserve Bank is evolving and transforming to achieve its vision of being a ‘Great Team, Best Central Bank’ and delivering on its core mandate while continuing to deepen its understanding of the changing world.
Mr Orr said, “We intend to epitomise a modern Central Bank. The Reserve Bank will operate

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Reserve Bank welcomes new funding agreement

June 25, 2020

Release date
26 June 2020

The Minister of Finance has agreed with the Reserve Bank Governor a new five-year funding agreement which will ensure Te Pūtea Matua (the Reserve Bank of New Zealand) has adequate resources to meet its increasing responsibilities and the expectations of New Zealanders.
“The new funding will enable us to invest in the capability and capacity of our team, and ensure our systems are robust and effective to support our vision of ‘Great Team, Best Central Bank’,” Reserve Bank Governor Adrian Orr said.
Unlike other Government agencies that seek funding through the annual budget process, the Reserve Bank makes money for the Crown through its balance sheet activities. Under the Reserve Bank Act, the Minister of Finance and the Governor

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Monetary Policy easing to continue

June 24, 2020

Tēnā koutou katoa, welcome all.
The Monetary Policy Committee agreed to continue with the Large Scale Asset Purchase (LSAP) programme aimed at keeping interest rates low for the foreseeable future. The LSAP quantum remains set at $60 billion. The assets included are New Zealand Government Bonds, Local Government Funding Agency Bonds, and NZ Government Inflation-Indexed Bonds. The Committee is committed to reviewing this quantum at regular intervals, with a focus on achieving its remit. The Official Cash Rate (OCR) is being held at 0.25 percent in accordance with the guidance issued on 16 March.
New Zealand has contained the spread of COVID-19 locally for now, enabling a relaxation of social restrictions and an earlier resumption of domestic economic activity than assumed in our May

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Reserve Bank approves sale of AMP Life

June 22, 2020

Release date
23 June 2020

The Reserve Bank has approved the proposed sale of AMP Life to Resolution Life, in a revised arrangement that is subject to a number of conditions imposed to protect policyholders.
The Reserve Bank has been reviewing the proposed transaction and consulting with the parties involved over the past 18 months to ensure the deal met our requirements, Deputy Governor and General Manager for Financial Stability Geoff Bascand says.
The transaction involves a change of control and ownership of AMP Life from AMP Ltd to Resolution Life. Resolution Life is a specialist life insurance business owner whereas AMP Ltd wishes to exit the life insurance ownership business.
AMP insurance policy holders’ relationship in New Zealand is with AMP Life and,

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Reserve Bank supports global call to action on remittances

June 19, 2020

Release date
19 June 2020

The Reserve Bank of New Zealand is supporting a worldwide multi-stakeholder appeal to keep and improve migrants’ access to remittance or money transfer services during the current economic crisis brought about by the COVID-19 pandemic.
Led by the Governments of Switzerland and United Kingdom, the call to action highlights the impact of the COVID-19 pandemic to economies, communities, and families dependent on remittances. The World Bank predicts that remittances to low and middle-income countries will drop by about 20%.
To address this, the call to action has recommendations on policy, regulations, and service provision to ensure affordable access to money transfer services of migrants and their families. New Zealand, led by the

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Reserve Bank releases thematic review of Appointed Actuary role

June 10, 2020

Release date
11 June 2020

The Reserve Bank has released a number of recommendations in a comprehensive review of the Appointed Actuary role.
Appointed Actuaries have a critical legislated role in the insurance industry to measure and report on material risks that can threaten the financial condition and solvency of an insurer. Importantly, the role also entails providing impartial advice to an insurer’s board of directors and senior management to assist with sound decision making. This support can greatly strengthen an insurer’s risk and capital management and lead to the increased security of policyholders.
The review, conducted by the Reserve Bank’s Industry Insights and Thematics team, was launched to better understand how the Appointed Actuary role works

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Reserve Bank Governor's Remarks: A Near Horizon

May 29, 2020

Release date
29 May 2020

Reserve Bank of New Zealand Governor Adrian Orr participated in a virtual roundtable with Mark Carney (United Nations Special Envoy for Climate Action and Finance and former Governor of the Bank of England) and James Shaw (Minister for Climate Change) on Thursday, 28 May 2020. They discussed pathways to achieve New Zealand’s transition to a low-carbon future, with a particular focus on the Recommendations of the Task Force on Climate-related Financial Disclosures (TCFD).
The event was organised by the McGuinness Institute, Simpson Grierson, and the Climate Disclosure Standards Board (CDSB).
Read the Governor’s remarks:

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Financial system will benefit supporting economic recovery

May 26, 2020

Release date
27 May 2020

Tēnā koutou katoa, welcome all.
The financial system is in a solid position to both weather the significant economic impact caused by the COVID-19 pandemic and support New Zealand’s recovery, Reserve Bank Governor Adrian Orr says in releasing the May Financial Stability Report.
“At the outset of the pandemic the banking system had significant capital and liquidity buffers, built up due to both regulatory requirements and several years of favourable banking conditions. These buffers can now be used to support their customers’ long-term economic future. Our economic stress test analysis suggest banks can continue to lend and prosper through a broad range of adverse scenarios,” Mr Orr says.
“Banks have a critical role in supporting

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Industrial and Commercial Bank of China limited registered as bank

May 17, 2020

Release date
18 May 2020

The Reserve Bank today announced that it has registered Industrial and Commercial Bank of China Limited (“ICBC”) to provide banking services in New Zealand.
Industrial and Commercial Bank of China Limited is incorporated in the People’s Republic of China and will operate in New Zealand as a branch. A New Zealand subsidiary of ICBC (the Industrial and Commercial Bank of China (New Zealand) Limited) has been registered to provide banking services in New Zealand since November 2013.
Consistent with the Reserve Bank’s dual registration policy, the Reserve Bank expects ICBC to conduct business in New Zealand through both the branch and the subsidiary, although there are limits on the nature and amount of business conducted through the

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Large Scale Asset Purchases expanded

May 13, 2020

Tēnā koutou katoa, welcome all.
The Monetary Policy Committee has agreed to significantly expand the Large Scale Asset Purchase (LSAP) programme potential to $60 billion, up from the previous $33 billion limit. The LSAP programme includes NZ Government Bonds, Local Government Funding Agency Bonds and, now, NZ Government Inflation-Indexed Bonds.
The global economic disruption caused by the COVID-19 pandemic is expected to persist and lead to lower economic growth, employment, and inflation both in New Zealand and abroad. Even if New Zealand successfully contains the spread of disease locally, reduced world activity will mean lower demand for many of New Zealand’s exports.
The Monetary Policy Committee is committed to achieving its employment and inflation objectives. The main support for

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