Financial stability – the soundness or resilience of the financial system – relates directly to the existing purpose of our prudential philosophy and is consistent with our intent to have a dynamic regulatory framework; a framework with rigorous and adaptable baseline standards and a more searching approach to supervision.
‘Financial stability’ has the advantage of clarity, providing a sharp focus for the Reserve Bank, but potentially downplays the importance of efficiency and dynamism that are equally relevant to our over-arching purpose: contributing to a sustainable and productive economy and the prosperity and wellbeing of New Zealanders.