Reserve Bank welcomes new deposit-taker requirements
Reserve Bank Governor Alan Bollard today welcomed the Cabinet decision for the Bank to be the new prudential regulator of non-bank deposit-takers.
Under the new arrangements the Bank's role will be to license deposit-takers, develop and enforce minimum prudential and governance requirements and apply credit rating requirements. Trustee corporations will continue to be the front-line supervisors of deposit-takers.
Dr Bollard said the proposals are expected to provide a more consistent approach to the supervision of deposit-takers and provide a stronger basis for confidence in the deposit-takers sector. "Improved disclosure and credit ratings will assist depositors to make better-informed investment decisions."
"Credit ratings from reputable rating agencies will play an important role in the new regulatory arrangements. Credit ratings assist depositors to better appreciate the risk they are taking with the matched return when they invest in a deposit-taker," commented Dr Bollard.
The Reserve Bank will engage with stakeholders, including deposit-takers and trustees, in developing the regulations once the legislation has been enacted. The Bank will also assist in the revision and simplification of public disclosure requirements for deposit-takers.
Legislation will be introduced into Parliament later this year to implement most of the proposals, with further legislation being introduced in 2008.
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