Thu, 09 Dec 2021

WELLINGTON, Oct. 20 (Xinhua) -- The Reserve Bank of New Zealand (RBNZ) is reviewing its policy for branches of overseas banks to keep pace with the evolving global regulatory environment, a senior bank official said on Wednesday.

The objective of the review is to create a simple, coherent and transparent policy framework for branches of overseas banks, Deputy Governor and General Manager for Financial Stability Geoff Bascand said in a statement.

"Overseas branches are a growing part of our financial system and it is timely to ensure their regulation and supervision promotes financial stability and that we are well placed to avoid significant damage to the financial system that could result if one failed," Bascand said.

Branches of overseas banks can be an important link between New Zealand economy and global financial markets. They provide valued services to New Zealand businesses and households, and greater diversity to the country's banking system, he said, adding they can also pose special risks.

There are 12 registered branches of overseas banks currently operating in New Zealand. The first branches were registered in the country in 1987, while the most recent was registered in 2020, and global regulatory requirements have evolved significantly over that time, Bascand said.

"We have launched a review of our current branch policy as in its present form and it is not applied consistently to all the branches we supervise," he said.

The RBNZ said it welcomes submissions on the policy questions set out in the Branch Policy consultation and any alternative options or proposals before March 2, 2022.

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