Our balance sheet (R1)

This is the Reserve Bank's balance sheet – a summary of the assets and liabilities we hold to fulfil our functions.
Released
14 October 2021 03:00 p.m.
Next release
12 November 2021 03:00 p.m.
Source
Reserve Bank of New Zealand
Periodicity
Monthly
Previous years: Monthly:
Sep 2019 Sep 2020 May 2021 Jun 2021 Jul 2021 Aug 2021 Sep 2021
Assets
Cash Balances 13,400 3,134 3,138 5,325 3,407 5,839 6,734
Investments - Foreign Currency 7,973 10,293 8,562 7,946 8,269 7,325 7,349
Investments - New Zealand Government Securities 3,428 3,345 3,375 3,529 3,539 3,549 3,700
Securities Purchased under Agreements to Resell 646 302 5,447 5,550 6,800 9,554 8,327
Securities - LSAP Programme 0 41,058 56,411 57,496 58,908 58,120 57,581
Crown Indemnity for LSAP Programme 0 0 3,107 3,126 2,442 3,269 3,834
Derivative Assets 245 273 631 471 435 467 422
Other Financial Assets 1,093 3,903 523 516 539 530 561
Other Assets 177 175 177 167 165 163 160
TOTAL ASSETS 26,962 62,483 81,371 84,126 84,504 88,816 88,668
Liabilities
Deposits 13,420 47,328 66,638 69,346 70,250 74,122 74,635
Crown Indemnity for LSAP Programme 0 748 23 25 28 26 28
Term Liabilities 1,591 1,588 1,398 1,397 1,398 1,399 1,399
Derivative Liabilities 1,426 734 330 424 451 382 506
Securities Sold under Agreements to Repurchase 0 112 619 487 475 176 248
Reserve Bank Bills 595 0 450 275 375 575 250
Currency in Circulation 6,853 8,042 8,162 8,175 8,217 8,324 8,499
Other Financial Liabilities 226 715 795 1,013 322 890 301
Other Liabilities 12 16 17 149 149 150 9
TOTAL LIABILITIES 24,123 59,283 78,432 81,291 81,665 86,044 85,876
Net Assets/Equity
Net Assets/Equity 2,839 3,200 2,939 2,835 2,839 2,772 2,792
Total Liabilities and Net Assets/Equity 26,962 62,483 81,371 84,126 84,504 88,816 88,668

Find out more about how the Reserve Bank used its balance sheet to support monetary and financial stability

The data: coverage, periodicity, and timeliness

Coverage characteristics

Data are published as end of month figures in millions of New Zealand dollars. The series start from July 2011.

Periodicity

Monthly

Timeliness

Data is released two to three weeks after the reference month.

Access by the public

Statistics release calendar

The Statistics Release Calendar provides a long-term plan of scheduled releases. It is updated and released on the first working day of the month.

View the Statistics Release Calendar.

Integrity

Dissemination of terms and conditions under which official statistics are produced, including confidentiality of individual responses

The information is disseminated by the Reserve Bank of New Zealand as a service to the public.

Provision of information about revisions and advance notice of major changes in methodology

Provisional data are italicised. Data are deemed provisional when a series is under review. New data, or revised data, are in bold font. This applies to the summary table only and not excel files. Revisions are generally published when the table is next due to be updated and released. Should revisions need to be made more promptly, a note is posted on the website.

Any major changes in methodology will be posted as a special note.

Quality

Dissemination of documentation on methodology and sources used in preparing statistics

Series data are prepared in accordance with Generally Accepted Accounting Practice in New Zealand. Specific accounting policies are disclosed in the Reserve Bank's Annual Report.

Dissemination of statistics that support statistical cross-checks and provide assurance of reasonableness

The full Reserve Bank Annual Report (subject to audit).

Data prior to July 2011 is available in the discontinued F1 and F2 tables. Note that the asset and liability categories in F1 and F2 may not be directly comparable with R1.

Last updated November 14, 2013

Assets

Cash Balances

Current accounts and margin accounts.

Cash balances are carried at amortised cost less impairment losses.

Investments - Foreign Currency

Fixed interest securities issued by foreign government, foreign near-government entities and supranational organisations, including accrued interest, and cash collateral paid as part of the Bank's swap arrangements.

Fixed interest securities are recognised initially at fair value. Realised and unrealised gains and losses arising from changes in the fair value of financial assets are included in the Statement of Financial Performance in the year in which they arise.

Cash collateral paid is carried at amortised cost.

Investments - New Zealand Government Securities

Holdings of securities issued by the New Zealand government i.e nominal bonds and inflation-indexed bonds.

The Bank intends to hold these securities until maturity. These government securities are measured at amortised cost less expected credit losses.

Securities Purchased under Agreements to Resell

Where the Bank purchases securities under agreements to resell (reverse-repurchase agreements), the securities are not reported in the Statement of Financial Position. The Bank does not enjoy the risks and rewards attached to ownership of those securities. Accordingly, the Bank records as assets the consideration receivable from the agreements to resell the securities. 

At initial recognition all reverse-repurchase agreements are recognised at fair value. Subsequently, the consideration receivable under an agreement to resell is recorded at fair value, except for the Funding for Lending Programme Tranche 1, as explained in the paragraph below. Movements in the fair value of reverse-repurchase agreements are reported in the Statement of Financial Performance within Net Gains / (Losses) from Fair Value Changes.

Funding for Lending Programme (FLP)

Reverse-repurchase agreements under FLP (Tranche 1) are accounted for at amortised cost less any provision for expected credit losses. Reverse-repurchase agreements under FLP (Tranche 2) are accounted for at fair value. The contractual provision in FLP Tranche 2 allowing a facility fee to be charged which is contingent on a decline in the volume of lending means that fair value must be used to account for FLP Tranche 2 assets. 

Concessionary Loans for Term Lending Facility

Reverse-repurchase agreements under the TLF are deemed to be concessionary loans under PBE IFRS 9 at initial recognition, where the fixed rate for the term of the loan (OCR) is less than the market rate for other high quality fixed interest securities of similar duration. The present value of the difference between the fixed rate of interest and the assessed market rate is expensed upon initial recognition, then amortised back as Interest Income over the remaining life of the loan.

Securities – LSAP Programme

Holdings of securities purchased from the secondary market.

The LSAP programme is an instrument used to lower borrowing costs to households and businesses. The Bank buys securities on the secondary market in exchange for newly created settlement balances. This is sometimes called Quantitative Easing (QE).

Securities in the programme are accounted for on a fair value basis with the interest component of the return accounted for using the effective interest rate method.

For more information, refer to Large Scale Asset Purchases.

Crown indemnity for large scale asset purchase programme

Large scale asset purchase programme Crown indemnity.

The Crown has agreed to indemnify the Bank in respect of interest risk losses which the Bank incurs in respect of the indemnified LSAP securities and credit risk losses on the indemnified LGFA Bonds (together net losses).

The Crown reimburses the Bank for any net losses from the LSAP programme and, conversely, any surplus from the programme must be paid to the Crown. The net losses from the programme is determined as income from the LSAP securities including any realised gains and losses from disposal of LSAP assets, less the cost of funding those assets. Additionally, the Crown has agreed to indemnify the Bank for any credit risk losses on LGFA securities, being contractual cash flows due in respect of LGFA securities in the LSAP programme which the Bank does not receive. The net losses for the LSAP programme is calculated for each calendar month and the relevant payment to or receipt from the Crown is made the following month.

The indemnity from the Crown is accounted for as a derivative under PBE IFRS 9 as it contains contractual obligations and rights in regard to the transfer of cash at a future date, and consequently meets the definition of a financial instrument. The indemnity is accounted for at its fair value. The fair value of the indemnity is determined to be the direct inverse of the unrealised change in the fair value of the underlying assets less the funding costs of purchasing the LSAP securities. The Bank also records as a liability or asset, as the case may be, unsettled payments to (or from) the Crown for realised net returns.

Derivative Assets

Primarily foreign currency swaps, bond and interest rate futures, interest rate swaps and cross currency basis swaps, including accrued interest.

Derivatives are initially recognised in the Statement of Financial Position at fair value on the date on which a derivative contract is entered into and are subsequently re-measured at their fair value. Fair values are obtained from quoted market prices in active markets, including recent market transactions, or valuation techniques, as appropriate. Derivative transactions, such as foreign currency swaps, and the payment and receipt of different currencies, are stated in the Statement of Financial Position at the net of the fair value of receipts less the fair value of payments, both expressed in New Zealand dollars. The net fair value of each derivative contract is determined individually and carried as an asset if the net fair value is positive and as a liability if that value is negative. Gains and losses on all derivatives are recognised in the Statement of Financial Performance.

Other Financial Assets

Sundry assets including short-term unsettled sales of financial assets and the Bank's long-term investment in shares in the Bank for International Settlements.

Sales of financial assets are recognised on trade date, the date on which the Bank commits to sell the asset. A receivable for the unsettled sale is recorded until settlement date.

The Bank's investment in shares in the Bank for International Settlements is carried at fair value. Gains and losses arising from changes in the fair value are recognised directly in equity until the asset is derecognised or impaired, at which time the cumulative gain or loss previously recognised in equity is recognised in the Statement of Financial Performance.

Holdings of purchased from the secondary market i.e. Early purchase of New Zealand Government securities and Bond Market Liquidity Support.

  1. Early purchase of New Zealand Government securities: As part of the Bank’s liquidity management operations, the Bank purchases New Zealand government securities generally up to six months before these securities mature. Gains and losses arising from changes in the fair value of these securities are recognised in the Statement of Financial Performance.
  2. Bond Market Liquidity Support: the Bond Market Liquidity Support (BMLS) facility aims to promote and support the functioning of key security markets during periods of market instability. The Bank’s presence in the markets and its willingness to transact enhances market liquidity and reduces bid-offer spreads that would otherwise prevail. The BMLS facility involves the Bank purchasing or selling security, principally government bonds and LGFA securities. Gains and losses arising from changes in the fair value of these securities are recognised in the Statement of Financial Performance.

Accounts receivable and sundry financial assets.

These assets are carried at amortised cost less impairment losses.

Other Assets

Inventories of currency on hand, property, plant and equipment, intangible assets, currency and artwork collections and archives.

Inventories of currency on hand are recognised in the Statement of Financial Position at cost less provision for impairment. Costs include the cost of bringing inventories to their present location and condition. For the portion of inventories of currency on hand that relates to currency repatriated to the Bank, this cost is measured at the current replacement cost of producing the currency at the time of repatriation.

Property, plant and equipment include land and buildings owned by the Bank. Land is recorded at fair value. Buildings are recorded at depreciated fair value. Surpluses of book value over historical cost are recorded in the equity. Where the book value of this class of asset falls below historical cost, previous revaluations are reversed and any remaining balance is charged as an expense in the financial year it occurs. The Bank obtains an independent valuation of land and building every three years. In the years between independent valuations, an annual assessment is made of whether or not there is likely to have been a material change in value. An independent valuation is obtained where a material change has occurred.

Other assets are carried at cost less depreciation and impairment losses.

Intangible assets comprise acquired and internally-developed computer software. Intangible assets are stated at cost less accumulated amortisation and impairment losses. Costs include all direct expenses incurred to acquire and bring to use the specific software. Capitalised software development costs are amortised on a straight-line basis over the estimated useful life of the software.

Memo Item: New Zealand Government Securities

New Zealand Government Securities is included as a memo item in the historic series of R1. This includes:

  • Securities in the LSAP Programme (recorded in Securities – LSAP Programme),
  • Early Purchases of New Zealand Government Securities (recorded in Other Financial Assets) and
  • Bond Market Liquidity Support (recorded in Other Financial Assets). 

Liabilities

Deposits

Deposits from the government, settlement institutions and other central bank deposits in New Zealand dollars, including accrued interest.

Deposits are recognised initially at fair value and subsequently stated at amortised cost.

Crown Indemnity for LSAP Programme

Large scale asset purchase programme Crown indemnity.

Refer to Crown indemnity for large scale asset purchases programme in Assets.

Term Liabilities

Financing provided by The Treasury, including accrued interest.

Term liabilities are recognised initially at fair value. Realised and unrealised gains and losses arising from changes in the fair value of financial liabilities are included in the Statement of Financial Performance in the year in which they arise.

Derivative Liabilities

Derivative liabilities are those derivative contracts where the net fair value is negative.

Refer to Derivative Financial Assets.

Securities Sold under Agreements to Repurchase

Securities sold under agreements to repurchase.

Where the Bank sells securities under agreements to repurchase, the security continues to be included as an asset in the Bank's Statement of Financial Position.

The consideration payable under the agreement to repurchase is recorded at fair value. Movements in the fair value of repurchase agreements are reported in the Statement of Financial Performance.

Where securities are lent under the Bank's securities lending programme and the Bank receives other securities as collateral those securities are recorded off-balance sheet. Up to 30 June 2017 the Bank recorded an asset being the market value of the securities lent and a liability for the same amount in respect of the collateral to be returned by the Bank at the conclusion of the loan. Changes in the value of the liability were reflected by a change in the corresponding asset. The Bank records income from securities lending as it accrues.

Reserve Bank Bills

Short-term discount securities issued by the Reserve Bank including accrued interest.

Reserve Bank bills are recognised initially at fair value. Realised and unrealised gains and losses arising from changes in the fair value of financial liabilities are included in the Statement of Financial Performance in the year in which they arise.

Currency in Circulation

The face value of notes and coins issued into circulation, including collectors' currency.

Currency issued by the Bank represents a claim on the Bank in favour of the holder.

Other Financial Liabilities

Include the Bank's liability for the face value of demonetised currency still in circulation and sundry payables.

Currency demonetised before 1 July 2004 is recognised as a contingent liability, except for a provision retained in the Statement of Financial Position to cover expected future redemptions. For currency demonetised from 1 July 2004, the Bank records a liability equal to the face value of that currency still in circulation.

The Bank has a liability for the face value of collectors' currency. The face value of collectors' currency issued before 1 July 2004 is recognised as a contingent liability. For collectors' currency issued from 1 July 2004, the Bank records a liability equal to the face value of that currency.

Sundry payables are recognised initially at fair value and subsequently stated at amortised cost.

Other Liabilities

Include employee-related provisions and a provision for payments of dividends to the New Zealand government.

These provisions are stated at either the present value of future payments expected to be made in respect of services provided by employees up to balance date or at accrued actual entitlements at that date.

A provision for the payment of dividends to the New Zealand government is recorded after a direction is given by the Minister of Finance.

Equity

Capital, retained earnings, general and special reserves and current period accumulated income.

Revision of Reserve Bank balance sheet June to August 2021

14 October 2021

During September 2021, a dividend of $140m was finalised and paid to the Crown. The June, July and August 2021 data has been restated to reflect the impact of the dividend paid. R1 has also been re-classified to match the Bank’s Annual Report published in October 2021.

Symbols and conventions for summary table

0 Zero or value rounded to zero
- Not applicable
.. Not available
bold Revised/new
italics Provisional
light red background Historical

General notes

  • Individual figures may not sum to the totals due to rounding
  • Percentage changes are calculated on unrounded numbers
  • You are free to copy, distribute and adapt these statistics subject to the conditions listed on our copyright page.