The New Year promises interesting times for the Reserve Bank and
those under its prudential supervision. Banks, non bank deposit
takers (NBDTs) and collective investment schemes will continue to
weigh up the option of participating in the Crown Deposit
Guarantee, and we can expect to see some regulations for the
supervision of NBDTs under the Reserve Bank of New Zealand
Amendment Act 2008 (NBDT Act).
Substantive obligations for NBDTs will be rolled out in the next
eighteen months to two years, with NBDTs being required to have
risk management programmes in place by 1 September 2009 and
mandatory credit ratings by 2010. The Reserve Bank has indicated
that it is working on approving agencies which would enable NBDTs
to commence their ratings reviews in order to be compliant.
We understand that a discussion paper will be released before
Christmas relating to minimum capital levels, minimum liquidity
levels and capital ratios. We anticipate that there will be a tight
deadline for feedback from the industry.
It remains to be seen how these pending regulations will be
viewed by the new Government, given indications that their
priorities (at least initially) lie in other areas. The Reserve
Bank has indicated that it will continue to consult with affected
parties. Trustees and other affected parties should expect to be
kept up to date and to be in consultation with the Reserve Bank
throughout the year.
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