National Bank Sale Another Air NZ/Qantas Mess?

Monday 1 Sep 2003 Stephen Franks Press Releases -- Commerce

ACT New Zealand Associate Commerce Spokesman Stephen Franks today called on Finance Minister Dr Michael Cullen to tell the Reserve Bank that he does not want it to sacrifice New Zealanders' financial security for political peace with Australia.

"The sale of National Bank to Australia looks like another Qantas/Air NZ deal. Labour is trying to buy political peace with an Australian government that acts absolutely in Australia's interests, and despises Prime Minister Helen Clark's effete foreign policy," Mr Franks said.

"ACT's opposition to the National Bank sale is principled - we oppose it until Kiwi customers have equal footing with their Aussie counterparts. Australia's Banking Act says that, in the event of a bank collapse, Australian depositors must be paid first. Even if the bank has a New Zealand-registered subsidiary, the systems in place cannot stop the loose money in New Zealand ending up in Australia.

"Labour has known of this risk for years, but done nothing. I called for action in 2001, after the Reserve Bank Deputy Governor revealed his concerns and acknowledged our exposure to the potential for Australian ruthlessness. He called these rules `predatory national regulatory practices', noting that the US and Australia has them, but Britain - where the National Bank is owned - does not.

"If the National Bank is to be sold to Australia, let it only be after Kiwi depositors are guaranteed an equal place at the negotiating table. The Government should announce that an Aussie bank has no chance until Australia repeals section 13A of its Banking Act, or extends it to cover New Zealanders so we share whatever's left equally.

"Labour will not do this, out of political self-interest. After reneging on immigration and defence obligations, its relationship with Australia is frosty. Our Reserve Bank could refuse registration because of Australia's section 13A, but the Government is too afraid to back it.

"Labour's cowardice cannot be allowed to hurt New Zealand. Aussie banks should be told `transaction declined' until they give us security. They must tell their government to give Kiwis a level playing field if they want to profit from us.

"Until then, Dr Cullen must stop any sale of National Bank to Australia. It is time he put aside Labour's fear of provoking blunt speaking from the Australian liberal government. Accept that risk and act now in the interests of all New Zealanders for a change," Mr Franks said.

For more information visit ACT online at http://www.act.org.nz or contact the ACT Parliamentary Office at act@parliament.govt.nz.

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