Reserve Bank outlines details of Funding for Lending Programme

The Reserve Bank has today outlined the details of the Funding for Lending Programme (FLP), expanding on the information already provided in the November Monetary Policy Statement.

Under the programme, the Reserve Bank will offer to lend funds to eligible counterparties at the Official Cash Rate (OCR) for a term of three years. The borrowing rate will adjust over the term of the transaction with any changes to the OCR.

Eligible counterparties can borrow up to an amount of 6 percent of their total outstanding loans to businesses and households, made up of an initial allocation of 4 percent and an additional incentive-based allocation of 2 percent based on new lending.

The programme will require approved eligible collateral to be pledged in a similar manner to the Reserve Bank's Open Market Operation (OMO) and Term Lending Facility.

The Reserve Bank will make the FLP available for eligible counterparties to use on a daily basis, for a period of 18 months for banks’ initial allocations and a further six months for banks’ additional incentive-based allocations.

Eligible counterparties will be able to access the FLP between 9:00am - 12:00pm every banking day.

Settlement will occur on the next business day.

The programme starts from 7 December and runs until 6 June 2022 for the initial allocations, and until 6 December 2022 for the additional allocations. 

The total volume of funds lent under the FLP will be published on the Bank’s D10 and D12 tables.

More information:

For further information contact:

Dean Hill
Senior Manager, Financial Markets
Email: [email protected]

Media contact:

Patrick O'Meara
Senior Adviser, External Stakeholders
MOB: 021 198 4227
Email: Patrick.O'[email protected]