Transparency and disclosure critical to COVID-19 response
Transparency and clear disclosure of actions and policies have been key to the COVID-19 response, Reserve Bank Head of Financial System Policy and Analysis Toby Fiennes said delivering a speech in Wellington today.
Market discipline is one of the three pillars in the Reserve Bank’s regulatory framework. It relies on transparency through good disclosure and reporting from regulated institutions and clear communication from us as the steward of the financial system, Mr Fiennes said.
“Whether you’re making a financial or business decision, clear, concise and up-to-date information is crucial to making informed decisions. As well as helping banks to keep focussed on their customers during the initial response to COVID-19, we’ve been working with others across Government and the financial sector to shore up confidence and cash-flow in the system.
“Transparency and communication about these actions, decisions and consequences is key to further understanding about our work. It’s important everyone has access to the right information at the right time.”
One of the Reserve Bank’s key initiatives for disclosure is the Bank Financial Strength Dashboard - an interactive website all about the financial health of registered banks in New Zealand. Not surprisingly, there is increased interest in financial disclosures during times of economic stress. Through the first few months of the COVID-19 pandemic, we saw a nearly fivefold increase in visitors to the Dashboard website.
Data is critical for monitoring and assessing vulnerabilities and emerging risks. We are continuously reviewing our data needs, looking for ways to fill data gaps and adjust to changing needs. As COVID-19 began to directly impact New Zealand we rapidly intensified monitoring, including the setup of new detailed, high frequency data collections.
The Reserve Bank is committed to further developing tools and approaches that enhance this transparency – including through improvements to the Dashboard, Mr Fiennes said.
- Speech by Head of Financial System Policy Analysis Toby Fiennes COVID-19, financial stability and transparency
- Bank Financial Strength Dashboard
- Mahi Tahi – Working together to enhance cashflow and confidence