The Reserve Bank, in conjunction with the Ministry of Economic Development, today released a discussion document on proposed disclosure requirements for the non-bank deposit taking (NBDT) sector.
The discussion document's main proposals include requiring NBDTs to disclose a standardised set of prudential information and for these disclosures to be updated six-monthly.
Reserve Bank Deputy Governor Grant Spencer said disclosure of standardised prudential information will provide investors with a framework for analysing an NBDT's risks, and allow investors to compare risks between NBDTs more easily. This will improve market discipline, and confidence in the NBDT sector.
"The six-monthly frequency also aligns prudential disclosures with financial statements during the life of a prospectus," he said.
Other proposals in the Prudential Disclosure Requirements for Non-Bank Deposit Takers discussion document include: disclosures being subject to auditor reviews; and investors being notified when disclosures are updated as a result of material changes in an NBDT's circumstances.
The discussion document and information on existing prudential requirements are available on the Reserve Bank website. The discussion document can also be accessed from the Ministry of Economic Development website.
Overview of non-bank deposit takers regime
Ministry of Economic Development
Submissions close on 19 May 2011.
Background
Prudential regulation of NBDTs is provided for in part 5D of the Reserve Bank of New Zealand Act 1989. The latest of these regulations came into effect in December 2010.
Since then the Reserve Bank and the Ministry of Economic Development have been working together to develop disclosure requirements for the prudential regulations under the Securities Act 1978.
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