Reserve Bank Publishes Response To Deposit Taker Core Standards Consultation

Scoop

01-05-2025

The Reserve Bank of New Zealand - Te Pūtea Matua has today published its response to submissions on three of the four core standards that set the prudential requirements deposit takers will need to meet in order to be licensed under the Deposit Takers Act 2023 (DTA).
Jess Rowe, Director Prudential Policy, says the response covers liquidity, disclosure, and Depositor Compensation Scheme (DCS) related requirements.
'The DTA standards give us a significant opportunity to create a coherent, modern and proportionate prudential framework,' Ms Rowe says.
'The three core standards covered in this release ensure deposit takers can manage their liquidity, provide timely prudential disclosures to the market, and meet data and disclosure requirements for the DCS.'
Public consultation on the proposed core standards generated 26 submissions from banks, non-bank deposit takers and industry groups.
'In response to comprehensive submissions and engagement from industry, we're making changes to further support a proportionate approach, reduce compliance costs, and improve regulatory efficiency,' says Ms Rowe.
'This shows our focus remains on ensuring prudent management of risk, in a manner that also supports an efficient, competitive and inclusive financial system.'
A fourth standard, the capital standard, was also included in the core standard consultation. This standard generated a significant number of submissions. To ensure we address these submissions, and the matters raised at the Finance and Expenditure Committee inquiry into banking competition, we have announced a more comprehensive review of key aspects of our deposit takers capital settings. The response to submissions on this standard will, therefore, not be published at this time.
Deposit Takers Act background
The Deposit Takers Act 2023 (DTA) modernises our regulatory framework to help ensure the safety and soundness of deposit takers and support a stable financial system that New Zealanders can trust.
Once the DTA is fully in force (expected to be in 2028), the Reserve Bank will begin regulating and supervising credit unions, building societies and finance companies (known as non-bank deposit takers or NBDTs), together with banks, under a single, consistent, and proportionate framework.
The Act also introduces a new Depositor Compensation Scheme (DCS), effective from 1 July 2025.
The Reserve Bank ran a consultation on the four core standards from May to July 2024 and on the nine non-core standards from August to November 2024.
More information
Deposit Takers Act
Implementation timeline
Proportionality Framework