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Applying for bank registration

This page covers who may apply for registration as a bank in New Zealand, the criteria and principles we use to assess registration, and information for potential applicants.

Who may apply for bank registration

Under section 70 of the Reserve Bank of New Zealand Act 1989 (the Act), any person may apply to become a registered bank. The Act prescribes what factors (see sections 73, 73A, 73B and 78) we must take into account when determining an application. 

Only applicants whose business substantially consists of the borrowing or lending of money, or the provision of other financial services, may be registered as a bank. 

Qualitative and quantitative criteria

When we are assessing applications for bank registration, we consider both qualitative and quantitative criteria.

The qualitative criteria mainly relate to the applicant's financial standing and ability to prudently manage its business. For example, we consider whether:

  • its incorporation and ownership structure is appropriate
  • its systems and controls for business risks are adequate
  • its loan portfolio is diversified enough. 

The quantitative criteria provide some objective evidence of an applicant's ability to meet the qualitative criteria, and its ability to carry on its business in a prudent manner on an ongoing basis after registration.

Statement of principles

We apply a set of principles to assess applications for registration, and to impose, vary, remove or add conditions of registration. 

Conditions of registration

The quantitative criteria also form part of a bank's conditions of registration. These conditions are designed to promote stability of the banking system by constraining, but not completely removing, bank risk in certain important areas. 

Our page on key prudential requirements has more information on registration conditions we usually impose. 

Key prudential requirements

Applying for bank registration

Potential applicants for bank registration can get information about registration from the following document:  

Our application for status as a registered bank provides guidance on what information potential applicants need to provide.

Bank applicants incorporated overseas

Bank applicants who are incorporated overseas must have the approval of their home supervisor to conduct banking business in New Zealand. They must also meet the prudential requirements imposed on them by the overseas supervisor. 

Accordingly, the conditions of registration that apply to branch banks mainly focus on compliance with the overseas supervisor's regulatory requirements.