Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search

 


NZ banks laughing all the way to the bank

NZ banks laughing all the way to the bank

New Zealand banks, among the developed world’s most profitable, just got more profitable according to KPMG’s Financial Institutions Performance Survey.

Despite difficult conditions throughout the rest of the economy, banks' profits grew 13.6 percent in the year to September 30, 2012 and KPMG forecast profits will continue to grow out to 2014. Interest margins, another measure of bank profitability, are also up to 2.25 percent – a high level not seen since the height of the last property bubble.

“New Zealand banks, amongst the most profitable in the developed world, have just got more profitable and their excessive profitability is damaging the rest of the New Zealand economy,” said Green Party Co-leader Dr Russel Norman.

“Our banking sector is dominated by the big four foreign banks – ANZ/National, BNZ, ASB, and Westpac – who are sending their record profits offshore draining the New Zealand economy of much needed capital.

“Bank profits repatriated to Australia constitute the single biggest income outflow in our current account deficit making it even more difficult for us to rebalance our economy.”

Dr Norman offered several solutions that could help stem the capital drain and return bank profits to more reasonable levels.

“The banking sector needs a fresh injection of competition, particularly from New Zealand owned banks,” Dr Norman said.

“The National Government has dragged its heels on retendering New Zealand’s biggest banking contract – the Government’s own master banking contract – a contract that has been held by Westpac and untendered for 24 years.

“Retendering the master contract will give New Zealand-owned banks an opportunity to tender for some of the government’s banking needs and lower the government’s overall costs.

“Finance Minister Bill English announced that the contract was going to be retendered in the 2011/12 financial year. But he hasn’t done it.

“For too long, the National Government and the Reserve Bank have been complacent about the excess profitability of our foreign-owned banking sector.

“Instead of promoting competitive behaviour in our banking sector, they’ve argued that excessive profits were an important part of bank stability. This is lazy thinking. Proper regulatory oversight is what ensures bank stability.

“We can have a secure banking sector which makes reasonable profits that don’t come at the expense of the rest of the productive economy.”

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Transport: Auckland Looks To Light Rail

The Board of Auckland Transport has called for an investigation into a light rail network, which could relieve traffic congestion on some of the region’s busiest roads.

This stems from work in 2012 (the City Centre Future Access study) which responded to a government request to develop a robust and achievable solution for access to the CBD.

That showed that the City Rail Link, together with surface bus improvement, provided the best regional solution. However, it also identified that the city centre is already facing serious congestion across all major road entry points which, if not addressed now, will worsen. More>>

 

RMA: Smith's Claims Don't Match Evidence - Greens

The Motu group’s research into the impacts of planning rules looked at the costs related to housing development but not the benefits of environmental protections and does not recommend significant changes to the RMA to reduce the cost of new house builds. More>>

ALSO:

Gordon Campbell: On The Similarities Between John Key And David Cameron

For years now, David Cameron has been the closest available thing to a mentor/analogue to our Prime Minister, such that Key watchers could be interested in an analysis of Cameron that appeared in the British press over the Christmas break. More>>

Gordon Campbell: On Ian Fletcher Resignation & GCSB’s New Role

It may well be that after being shoulder-tapped in Queensland for the GCSB job, three years of living in Wellington has been enough for Fletcher and his family, given that the pending review of the GCSB would have required an even longer commitment from him. Three years of Wellington’s weather is enough for anyone... More>>

ALSO:

Ian Apperley: $10m Or $100m For New Wellington Council IT System?

I feel a Tui Billboard coming on. I commented the other day that it looked like the Council’s Ninth big project was a potential $100 million plus... The Mayor has responded: “I am reassured by the Chief Executive and by Anthony Wilson that the proposed budget is in the region of $10 million.” More>>

ALSO:

Southern Ocean:
Navy Intercepts Illegal Fishing Vessels

Foreign Minister Murray McCully today put illegal fishing vessels operating in the Southern Ocean on notice and vowed to take action against their owners. “As part of a multi-agency operation, the HMNZS WELLINGTON has intercepted two vessels claiming to be flagged to Equatorial Guinea, fishing illegally in the Southern Ocean.” Mr McCully says. More>>

ALSO:

Kiwi Pride: New Zealand Takes UN Security Council Seat

“New Zealand’s term on the Security Council will place us at the heart of international decision-making for the next two years,” Mr McCully says. More>>

Greens: CAA Airport Door Report Conflicts With Brownlee’s Claims

The heavily redacted report into the incident shows conflicting versions of events as told by Gerry Brownlee and the Christchurch airport security staff. The report disputes Brownlee’s claim that he was allowed through, and states that he instead pushed his way through. More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Parliament
Search Scoop  
 
 
Powered by Vodafone
NZ independent news