Tripe: Banks exposed
He said: “New Zealand banks are indeed vulnerable to shocks, but they have taken some action to protect themselves against these. In most cases, they have capital well in excess of the required minimum, set by the Reserve Bank, and inclined to be conservative than what is specified internationally.”
An IMF report earlier this month suggested capital requirements for major lenders should be increased to offset that vulnerability.
But the Reserve Bank was unconcerned. A spokeswoman said it was only a working paper, and the views were that of the author, not the official IMF view.
“Also worth noting, is the fact the working paper highlights the conservative approach the Reserve Bank has taken generally in its prudential regulation.”
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