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Information release

Closer Integration of Trans-Tasman Banking Regulation Information Release

Issue date: 
Saturday, 27 October 2007
Status: 
Current
Corporate author: 

Documents relating to work done in 2004 and 2005 by officials on reviewing the performance of New Zealand financial institutions and on developing a framework for closer integration of the prudential regulation of the New Zealand and Australian banking systems.

In January 2004, New Zealand’s Minister of Finance and the Australian Treasurer proposed working towards closer integration of the prudential regulation of the New Zealand and Australian banking systems. To this end, a joint working party was formed comprising officials from the New Zealand Treasury, Reserve Bank of New Zealand (Reserve Bank), Australian Treasury, Australian Prudential Regulation Authority (APRA) and the Reserve Bank of Australia (RBA). In July 2004, this working party submitted a joint report to their respective ministers titled 'Development of a Framework for Closer Integration of Trans-Tasman Banking Regulation'.

This report scoped two models for closer integration: enhanced home/host supervision; and APRA as supervisor of the New Zealand operations of Australian-owned banks. The second of these options raised some concerns for the New Zealand authorities, which are outlined in the Treasury report titled 'Treasury and Reserve Bank Comment on Closer Integration of Trans-Tasman Banking Regulation'.

Following on from this work, the Reserve Bank is working on the enhanced home/host model for supervision, which seeks to build on current regulation frameworks and institutions. Under this model, the Reserve Bank will seek to harmonise regulatory rules with Australia where appropriate and to strengthen arrangements for information sharing and coordination with the Australian authorities to improve the capability of both Reserve Banks to manage a crisis or failure situation.

New Zealand officials also proposed that further work be undertaken on the effectiveness of current financial sector regulatory practices and arrangements in New Zealand, their impact on financial and economic developments and whether this could be further enhanced through other trans-Tasman arrangements. A review group comprising the New Zealand Treasury, Reserve Bank and Ministry of Economic Development was set up to undertake this work. The review group's terms of reference ('Review of the Regulation and Performance of New Zealand’s Major Financial Institutions') and the Cabinet paper 'Proposals for Closer Integration of Trans-Tasman Banking Regulation and Supervision' outlines the review process.

The review group reported to the Minister of Finance and Minister of Commerce in January 2005. The group's report 'Review of the Regulation and Performance on New Zealand's Major Financial Institutions' (including appendices and a cover note) is available here. An accompanying Treasury report 'Meeting with the Australian Treasurer - Trans-Tasman Banking Regulation' is also available.

Additional information is also available on the Reserve Bank web site, including some details of the enhanced home/host model for supervision - see Trans-Tasman Banking Regulation.

Documents are available in Adobe PDF format only. HTML versions can be supplied on request from Information Services at the Treasury.

Using PDF Files

Doc. Date Created by Title Download
8 Jan 2005 Review Group Cover Note - Review of the Regulation and Performance on New Zealand's Major Financial Institutions [Report by the Review Group]
Released 1 Mar 2005. One of three parts to the report to the Minister of Finance and the Minister of Commerce by the Review Group.
rrpnzmfi-cover.pdf (42 KB)

1 Jan 2005 Review Group Report - Review of the Regulation and Performance on New Zealand's Major Financial Institutions [Report by the Review Group]
Released 1 Mar 2005. One of three parts to the report by the Review Group.
rrpnzmfi-report.pdf (273 KB)

1 Jan 2005 Review Group Appendices - Review of the Regulation and Performance on New Zealand's Major Financial Institutions [Report by the Review Group]
Released 1 Mar 2005. One of three parts to the report by the Review Group.
rrpnzmfi-appendices.pdf (582 KB)

28 Jan 2005 The Treasury Treasury Report T2005/75: Meeting with the Australian Treasurer - Trans-Tasman Banking Regulation
Released 1 Mar 2005.
tr05-75.pdf (135 KB)

Jul 2004 New Zealand & Australian Officials Trans-Tasman Report: Development of a Framework for Closer Integration of Trans-Tasman Banking Regulation
Released 8 Jan 2005. Joint report to the Minister of Finance of New Zealand and the Australian Treasurer by Australian and New Zealand officials from the Australian Treasury, Reserve Bank of Australia, Australian Prudential Regulation Authority, The Treasury and Reserve Bank of New Zealand.
dfcitbr-jul04.pdf (135 KB)

16 Aug 2004 The Treasury Treasury Report T2004/1486: Treasury and Reserve Bank Comment on Closer Integration of Trans-Tasman Banking Regulation
Released 8 Jan 2005.
tr04-1486.pdf (89 KB)

Aug 2004 Cabinet Cabinet Policy Committee Memorandum: Proposals for Closer Integration of Trans-Tasman Banking Regulation and Supervision
Released 8 Jan 2005.
polmem-aug04a.pdf (57 KB)

[Undated] The Treasury, Reserve Bank of New Zealand & Ministry of Economic Development Terms of Reference for a Review of the Performance and Regulation of Major Financial Institutions in New Zealand
Released 8 Jan 2005.
mfireview-tor.pdf (30 KB)

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Last updated: 
Thursday, 15 November 2007