Review will improve stock of regulation
The Reserve Bank is committed to delivering a world-class regulatory framework that is lean, easy to use and as cost-effective as possible, while still supporting the soundness and efficiency of the financial system.
Deputy Governor Grant Spencer this evening released further detail of the Reserve Bank's plan to review prudential regulation, in a speech to the NZ Bankers' Association. The regulatory review was announced on 14 May.
"It is sound practice to review any regulatory regime from time to time, particularly when it has been subject to a period of rapid change. We see the review as an opportunity to improve our regulatory framework and the processes we use to develop regulation," Mr Spencer said.
"Our aim is to improve the efficiency, clarity and consistency of prudential regulation. We must be sure that our prudential regulations are fit-for-purpose and that the benefits outweigh the constraints and costs.
The review is not intended to redesign the basic building blocks of the regime that we regard as appropriate and necessary for a sound and efficient financial system. The review of prudential regulation will shape and thin the stock of regulation rather than being a severe pruning, he said.
"The Reserve Bank agrees with the general international consensus on financial system regulation, but retains flexibility to adapt regulations to suit New Zealand conditions," Mr Spencer said.
Mr Spencer said that the regulatory stocktake will not look at the insurance regulatory regime which is still too young.
The review of prudential regulation will take about 12 months, starting with a scoping workshop with industry participants. There will be further industry workshops to develop draft proposals and a public consultation on the final set of proposals.
Angus Barclay, External Communications Adviser
Phone 04 471 3698, mobile 027 337 1102, [email protected]