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NZ: RBNZ Strategic Priorities

Wednesday 28 June 2017

The Reserve Bank of New Zealand (RBNZ) underlined their commitment in its Statement of Intent (SOI) for 2017-2020.

“The SOI outlines other key projects, including improving the resilience of the Bank’s operations and developing a plan for the future custody and distribution of currency,” spokesperson for the bank said, in a recently-released statement.
This comes just days after RBNZ outlaid the methods they have been taking to engage with industry and consumers.

RBNZ’s strategic priorities can be framed around three themes:

  • Enhancing bank’s policy frameworks;
  • Continuing to strengthen the Bank’s internal and external management; and
  • Improving infrastructure and reducing enterprise risk.

 “The outlook for New Zealand’s economic growth remains positive, albeit with considerable uncertainty remaining, especially internationally,” said Governor Graeme Wheeler.

The statement released by RBNZ asserted that New Zealand’s financial system remains sound and continues to function effectively. It continued that the International Monetary Fund’s (IMF) Financial Sector Assessment Programme (FSAP) has provided ‘useful’ input for the continuous development of the RBNZ’s prudential regime.

“The Bank will also review the macro-prudential policy framework in line with the five-year requirement set out in the Memorandum of Understanding between the Bank and the Minister of Finance,” the statement indicated.
The Bank will be working on replacing the Exchange Settlement Accounting System (ESAS) and the Settlement and Depository System (NZ CLEAR). RBNZ will also be implementing a best-practice roadmap for the management of balance sheets and finances.

The SOI also included information on:

  • How key macro-economic relationships and behaviours have changed, and the implications for the operation of monetary policy;
  • The effects of any economic or environmental changes on the practical application of the Policy Targets Agreement, ahead of a new agreement being agreed by the Minister of Finance and the Reserve Bank Governor next year;
  • Assessments of financial system stability risks and the suitability of policies to reduce the likelihood and impact of a bank failure in New Zealand, including the potential implications for the Crown’s balance sheet;
  • Assessments of the effectiveness of the macro-prudential tools outlined in the Memorandum of Understanding agreed in 2013, and views on including a debt-to-income-ratio tool in the macro-prudential policy toolkit; and
  • Progress with key policy developments and reviews—including the Insurance (Prudential Supervision) Act 2010 review, the Bank’s review of bank capital, and responses to the IMF’s FSAP review.