A populist report

Comments on my post on the Commerce Commission draft report that examined New Zealand’s personal banking services kept me busy this week. I received some interesting emails and phone calls. One thing that I missed from most of these interactions was the motivation of the Commerce Commission to write this report. Why did the Commerce… Read More A populist report

New Zealand’s Commerce Commission plea for lower bank capital to bolster bank competition – what could possibly go wrong?

On 21 March, the New Zealand Commerce Commission published a study of the domestic personal banking services market. For those who are unfamiliar with the Commerce Commission, it is New Zealand’s leading agency for promoting competition, ensuring fair trade, and protecting consumer rights, dedicated to keeping markets fair and informed. The study finds that the… Read More New Zealand’s Commerce Commission plea for lower bank capital to bolster bank competition – what could possibly go wrong?

Kiwibank’s Strategic $225 Million Investment: Navigating Growth and Risk

Last week, Kiwibank’s owner Kiwi Group Capital announced that it invested $225 million into Kiwibank. The purpose of this investment is to accelerate growth. The infusion, a year after the government bailed out the largest New Zealand-owned bank, should be seen as an “expression of confidence”. I have written often about the bank, non of… Read More Kiwibank’s Strategic $225 Million Investment: Navigating Growth and Risk

Latest RBNZ Dashboard data shows New Zealand’s banks’ profits easing

Today’s updated RBNZ Financial Strength Dashboard shows that New Zealand’s largest banks are feeling the pressure of what looks like a cooling economy.  Profits at the end of the first quarter are down, the Cooperative Bank reported a loss, provisions are up, net interest income is down. This is not great, because banks need profits… Read More Latest RBNZ Dashboard data shows New Zealand’s banks’ profits easing

The RBNZ Financial Stability Report: plus ça change.

Yesterday, the Reserve Bank published its May Financial Stability Report (FSR). It’s always an interesting read, and I guess that RBNZ employees enjoy contributing to this publication. I will not dwell too long on the report, as the message is very Blue Peter: “New Zealand’s financial system is well placed to handle the increasing interest… Read More The RBNZ Financial Stability Report: plus ça change.

What happened to the whipping boy of bank capital?

This week, financial markets were spooked by the write-down of Additional Tier 1 securities of Credit Suisse. Soon after the writedown, a discussion ensued regarding its legitimacy. One camp argues that investors in these securities should have read the instruction manual. See the pointy opinion piece in IFR by Prasad Gollakota, the former co-head of… Read More What happened to the whipping boy of bank capital?