Reserve Bank to Be Prudential Regulator of Banks, Non-bank Deposit Takers and Insurance Companies Information Release

In June 2007 the Treasury released documents relating to the Government's decision to extend the scope of the Reserve Bank's prudential regulation functions to cover non-bank deposit-takers and insurance companies (non-bank deposit-takers include finance companies, building societies and credit unions) and the resulting changes to institutional arrangements for the Reserve Bank.

The Reserve Bank is currently responsible for the prudential regulation of banks. As part of its Review of Financial Intermediaries, Products and Providers, the Government has decided to extend the scope of the Reserve Bank's prudential regulation functions to cover non-bank deposit-takers and insurance companies (non-bank deposit-takers include finance companies, building societies and credit unions).

In extending the Reserve Bank's prudential regulation responsibilities, the Government has decided to make a number of changes to the institutional arrangements for the Reserve Bank. These include modifications to governance and accountability arrangements, policy responsibilities, funding arrangements and legislative settings.

The Reserve Bank's response to these changes is set out on the Reserve Bank of New Zealand web site - see Review of domestic and trans-Tasman regulation and supervision of financial institutions. Information on all elements of the Review of Financial Intermediaries, Products and Providers is available through the Ministry of Economic Development's web site - see Review of Financial Products and Providers.