https://www.fma.govt.nz/news-and-resources/media-releases/nzx-and-fma-initiate-industry-review-capitalmarkets-2029/  Ref #8022722 v2.0  Purpose  Relevant tools  Macroprudential policy  Borrower restrictions (LVRs)  Reduce risk that the financial system amplifies a severe economic downturn  Impact on financial system resilience  Impact on wider economy More resilient households and banks reduce potential severity of an economic downturn  Reduced losses in a severe economic downturn Lowers incentives on banks to deleverage in a downturn; supports higher credit supply and economic activity  Capital and liquidity instruments (CCyB/SCR) Capital buffers Prudential policy  Crisis Management  Maintain baseline resilience of the financial system  Liquidity policy  Banks remain solvent through the economic cycle  Maintains market confidence and lowers risk of sudden increases in funding costs for households, businesses and the economy  Banks remain functioning parts of financial system  Maintains availability of credit and banking services necessary for economic activity  Governance and local incorporation Collateral standards  Manage and limit impact of distress or failure  Outsourcing Open Bank Resolution  Mitigates costs for creditors9 and taxpayers Minimum capital  9  Losses absorbed first by shareholders  The government has announced its ‘in-principle’ decision to introduce deposit insurance.
Ref #8022722 v2.0  Supervision, oversight and disclosure  Crisis Prevention  9  10  There may, at the margin, be some substitutability between our different regulatory tools and settings. However, as I’ve said, our regulatory tools are intended to be complementary.