Institutional Arrangements For Prudential Regulation
[ Last Updated 19 June 2007 ]
Institutional changes will be made to support the Reserve Bank as the single prudential regulator for banks and also now NBDTs and insurance companies.
Objectives:
- Wider scope of the Reserve Bank’s prudential functions
- Preserve the Reserve Bank’s separation of monetary policy and prudential regulation
Changes to institutional arrangements:
- Governance and accountability changes to increase the Reserve Bank's transparency and responsiveness to government while maintaining its regulatory independence
- Bolstered monitoring and reporting requirements (enhanced Reserve Bank’s Statement of Intent; Annual Report; 6-monthly Financial Stability Report)
Changes to policy advice responsibilities:
- Reserve Bank to provide policy advice to the Minister of Finance on prudential regulation for deposit takers and insurers
- Immediate transfer of this responsibility from the Ministry of Economic Development to expedite the policy development process for NBDTs and insurers
Two sets of legislative changes proposed:
- Changes to governance and accountability arrangements in the Reserve Bank of New Zealand Act
- New legislative provisions for new regulatory functions and powers
- Separate legislative provisions for NBDTs and insurance companies
For further information, contact the Reserve Bank or The Treasury.
Cabinet Papers
Institutional Arrangements For Prudential Regulation
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Institutional Arrangements For Prudential Regulation Q&A
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