Non-Bank Deposit Taker Oversight

The Reserve Bank regulates non-bank deposit takers in New Zealand for the purposes of promoting the maintenance of a sound and efficient financial system, and avoiding significant damage to the financial system that could result from the failure of a non-bank deposit taker.

Non-bank deposit takers are companies that are not banks, but which issue debt securities (as defined in the Securities Act, 1978) to the public and are engaged in the business of borrowing and lending money, or providing financial services.

Trustee companies are responsible for supervising non-bank deposit takers’ compliance with the prudential regulations established by the Reserve Bank.

In December 2005, the government agreed that the Reserve Bank should be the sole regulator of the New Zealand financial system, including the non-bank deposit taking sector. In September 2008, the Reserve Bank Amendment Act was passed, laying the foundation for the prudential regulations for non-bank deposit takers’ that are currently being developed by the Reserve Bank.

Review of non-bank deposit taking sector

This section details the review which led to the decision for the Reserve Bank to be the sole regulator of the New Zealand financial system, including non-bank deposit takers.

Regulation of non-bank deposit takers

This section provides information for industry participants and the general public on the current development of the prudential regulation regime for non-bank deposit takers.