Independent Report Finds Improvement In Westpac NZ’s Liquidity Management

An independent report into Westpac NZ’s liquidity risk management has found that it is moving in the right direction as it builds a proactive risk culture.

In March 2021 the Reserve Bank of New Zealand - Te Pūtea Matua required Westpac NZ to commission an independent report assessing the management of its liquidity risks, and the culture surrounding it, after finding the bank to be in breach of the Reserve Bank’s Liquidity Policy.

The report, prepared by Deloitte, found that Westpac NZ’s repatriation of its liquidity model from its parent to New Zealand and other risk management enhancements has led to an overall improvement in its liquidity control environment. Deloitte’s assessment found no material gaps in the changes made, but detailed a number of further recommendations to enhance the progress that Westpac NZ has made to date.

“We are encouraged to see that Westpac NZ has taken the necessary steps to improve its liquidity risk management and risk culture by increasing its resourcing and improving its governance processes,” Deputy Governor Christian Hawkesby says.

“We expect that the momentum built to date will allow Westpac NZ to continue the overall transition from a reactive, to a proactive risk culture.”

We appreciate Westpac NZ’s cooperation with the review process and maintain our assessment that Westpac NZ’s financial position is sound.

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