Our approach to supervision
Information on how we approach prudential supervision of regulated entities.
Our approach to supervision is set out in the Statement of Prudential Policy.
Statement of Prudential Policy
Who we supervise
We supervise regulated:
- banks
- insurers
- Financial Markets Infrastructures (FMIs).
We also regulate and license non-bank deposit takers (NBDTs) and work with trustee companies that supervise NBDTs compliance with their trust deeds.
Our approach to supervision
We take a risk-based approach
We take a risk-based approach to our supervision activities that is proportionate, collaborative and consistent. We have a low-risk appetite for outcomes that could harm the health of the financial system, undermine economic wellbeing and affect public confidence.
We promote a sound, competitive and diverse financial system
We aim to promote a sound, competitive and diverse financial system where market participants can make informed choices about risk. We encourage and incentivise sound management of institutions by directors and managers. In the event of major difficulties at a regulated entity, we aim to minimise the impact of those difficulties on the wider economy, the financial system and on depositors and policyholders.
We are proactive
We are proactive, open and constructive in engaging with industry and stakeholders. We develop and maintain a good working knowledge of our regulated entities and of the risks they are managing.
We work closely with:
- the Financial Markets Authority (FMA), the Commerce Commission (ComCom) and other members of the Council of Financial Regulators
- other Government agencies
- Australian authorities for regulated entities with trans-Tasman activities or links.
Our relationship charter with regulated entities