New Council to support close regulatory cooperation
A new Council of Financial Regulators has been established to foster cooperation between financial and prudential regulators in New Zealand.
On 9 September, the Council held its first meeting, chaired on this occasion by Reserve Bank Governor Alan Bollard.
The permanent members of the Council are the Bank and the Financial Markets Authority (FMA). Associate members are The Treasury and Ministry of Economic Development. Senior officials of the four organisations were present at Friday's inaugural two-hour meeting.
"What the Council means for New Zealand is that the two key financial services regulators are talking together regularly and at a high level," said Dr Bollard.
FMA CEO Sean Hughes said: "We aim to implement a new era of cooperation and information sharing that will result in better, more informed regulation of New Zealand's capital and financial markets."
The Reserve Bank had good working relations at an operational level with FMA's predecessor bodies, such as the Securities Commission. The Council embeds and reinforces those working relationships and ensures important issues are discussed at the most senior level.
The Council's objectives include the sharing of information, identifying important trends and issues and coordinating responses to those issues, and ensuring appropriate coordination arrangements are in place to respond to events and developments. The regulators expect that the arrangement will enable them to identify and respond more quickly to emerging common concerns in the financial system.
At the meeting's end, a Memorandum of Understanding (PDF 1.2MB) was signed between Dr Bollard and Mr Hughes on behalf of their respective organisations.
The Council will meet on a quarterly basis, and the Bank and FMA will take turns to chair the meetings. Issues discussed will remain confidential unless disclosure is required by law or agreed by the permanent members.
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