Domestic Institutional Arrangements Review
[ Last Updated 1 February 2006 ]
As the Government is undertaking several reviews relating to financial sector regulation it was a timely opportunity to review the domestic institutional arrangements of the New Zealand regulatory bodies to ensure a consistent and the most optimal approach to financial sector supervision.
The Domestic Institutional Arrangements (DIA) Cabinet Paper has made an in principle decision that there will be one prudential regulator for the New Zealand financial sector and that regulator be the Reserve Bank of New Zealand (RBNZ). No change is recommended to the current arrangements for market conduct supervision which is the responsibility of the Securities Commission.
The Review of Financial Products and Providers (RFPP) has signalled in principle, greater prudential regulation of non-bank deposit taking institutions, some insurers and some superannuation schemes. This decision supports the DIA in principle recommendation that the prudential regulation of the financial sector be undertaken by the RBNZ. A final report back in respect to the DIA is scheduled for November 2006 as the RFPP is yet to make policy decisions that will inform the detailed institutional arrangements for the prudential supervisor. Ministers will then have the opportunity to confirm that the prudential regulator will be the RBNZ.
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