Scoop has an Ethical Paywall
Work smarter with a Pro licence Learn More

Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Statement from Westpac New Zealand

15 November 2017

Statement from Westpac New Zealand

The Reserve Bank of New Zealand (RBNZ) has informed Westpac New Zealand Limited (WNZL) of its decision following a review of WNZL’s compliance with aspects of its advanced internal ratings-based (IRB) accreditation. The decision applies only to WNZL and not to Westpac Banking Corporation (including its New Zealand branch).

The RBNZ has raised the bank’s minimum regulatory capital ratios, until issues identified in the review are remediated. In the case of the common equity capital ratio the minimum has been raised from 4.5% to 6.5%.

WNZL’s current regulatory capital ratios are sufficient to accommodate these increases with the total capital ratio at 30 September 2017 of 16.1% compared to the requirement to maintain the ratio above 15.1% until the issues are remediated.

The review focussed on the manner in which WNZL operated its credit risk rating system and the extent to which it sought required approvals from the RBNZ to changes in its credit risk models. WNZL is disappointed not to have met the RBNZ’s requirements in this area.

The RBNZ has acknowledged that WNZL’s capital has remained well above required regulatory levels.

WNZL has publicly disclosed its non-compliance with aspects of the RBNZ’s IRB framework in its Disclosure Statements since September 2016.

WNZL acknowledges the high standards required of an IRB accredited bank and has already taken several steps to address the issues raised in the review. WNZL looks forward to working with the RBNZ over the next phase of remediation work.

Advertisement - scroll to continue reading

Are you getting our free newsletter?

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.

The new minimum regulatory capital ratios from 31 December 2017 will be 6.5% for Common equity Tier 1 capital, 8% for Tier 1 capital, and 10% for Total regulatory capital. As at 30 September 2017, WNZL’s respective minimum capital ratios were 4.5%, 6% and 8%. WNZL has also undertaken to maintain its total regulatory capital ratio above 15.1% during the period of remediation.

As at 30 September 2017, WNZL’s regulatory capital ratios were 11.1% for Common equity Tier 1 capital, 14.0% for Tier 1 capital, and 16.1% for Total regulatory capital.


Relevant Disclosure Statements

September 2016

December 2016

March 2017


June 2017


ends

© Scoop Media

Advertisement - scroll to continue reading
 
 
 
Business Headlines | Sci-Tech Headlines

 
GenPro: General Practices Begin Issuing Clause 14 Notices

GenPro has been copied into a rising number of Clause 14 notices issued since the NZNO lodged its Primary Practice Pay Equity Claim against General Practice employers in December 2023.More

SPADA: Screen Industry Unites For Streaming Platform Regulation & Intellectual Property Protections

In an unprecedented international collaboration, representatives of screen producing organisations from around the world have released a joint statement.More

 
 
 
 
 
 
 
 
 
 
 
 

Join Our Free Newsletter

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.