NZ cbank wants power to approve bank acquisitions
WELLINGTON: New Zealand's central bank wants the power to approve any significant merger or acquisition by local banks to protect the broader financial system, according to a policy paper released on Tuesday.
The Reserve Bank of New Zealand (RBNZ) said locally incorporated and registered banks should have to obtain a notice of non-objection from the central bank before going ahead with any large deals.
It said it wanted a say in any decisions even though banks' boards of directors were the ones to assess the merits and risks of such acquisitions.
"The proposed policy is intended to enable the bank to assess any risks to the wider financial system arising from a significant acquisition before that acquisition takes place," said RBNZ deputy governor Grant Spencer.
He said the proposed change would bring New Zealand into line with international standards and was appropriate given the global financial crisis. -PB News