NZ cbank wants power to ap­prove bank ac­qui­si­tions

The Pak Banker - - Front Page -

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

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