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DTA legislation and regulation

Find out more about the new regulatory environment under the Deposit Takers Act 2023.

Why we are creating a single regulatory regime

Under the Deposit Takers Act 2023 (DTA), we are bringing all deposit takers under a single, consistent and proportionate regulatory framework.

Currently, we regulate and supervise banks under the Banking (Prudential Supervision) Act 1989. We also regulate and license non-bank deposit takers (NBDTs) under the Non-bank Deposit Takers Act 2013 and work with the trustee companies that supervise them. From 2028, it is intended that both Acts will be superseded by the DTA.

Regulation and supervision of entities

Under the DTA, prudential regulation and supervision applies to entities that are in the business of borrowing and lending unless they are excluded from the regime. This includes banks, credit unions, building societies and finance companies. 

A proportionate approach

In March 2024, we published the first statutory document under the DTA – the Proportionality Framework. The Proportionality Framework sets out how we take a proportionate approach when developing prudential standards for licensed deposit takers under the DTA. You can find the Proportionality Framework and related consultation materials below.

Proportionality Framework

Rather than taking a ‘one-size-fits-all’ approach to prudential regulation, we consider differences in the deposit-taking sector. This includes the size and nature of the business. We also balance the costs and benefits of regulation with different deposit takers. This means the public can benefit from a safe, sound and stable deposit-taking sector and one that can be diverse, innovative and inclusive.

To develop prudential standards, the Proportionality Framework groups locally-incorporated licensed deposit takers into 3 groups based on their total asset size, with a fourth group for overseas licensed deposit takers (branches).

Proportionality Framework consultation

You can find consultation information, submissions and our responses on our consultation page.

Proportionality Framework consultation

RBNZ Proportionality Framework triangle

Prudential standards

Prudential standards are the secondary legislation provided for under the DTA. The standards will replace over 800 pages of the banking handbook, conditions of registration, Orders in Council and NBDT regulations. Comprising core and non-core standards, they set the prudential requirements for deposit takers with the aim of protecting and promoting the stability of the financial system. The currently anticipated standards and their approximate timelines are listed in the table below.

Core Standards

First consultation May to August 2024

  • Capital
  • Liquidity
  • Disclosure
  • Depositor Compensation Scheme (includes Single Depositor View) 

Non-core Standards

First consultation August to November 2024

  • Outsourcing
  • Lending - Loan to Value Ratio (LVRs) and Debt to Income Ratio (DTI)
  • Related party exposures
  • Restricted activities
  • Governance
  • Risk management
  • Operational resilience
  • Branches
  • Open Bank Resolution

DTA implementation timeline

See the full DTA implementation timeline