While shocks to the banking system cannot be avoided, particularly those that originate from outside our borders, we believe that by making some changes to our banking rules, we can improve the prospects that our banks will survive those shocks and be able to continue lending.8 And by doing so, we can improve the economic and social wellbeing of all New Zealanders.
Bank Capital – What it is and isn’t When we talk about ‘bank capital’, what are we talking about? I ask this question because bank capital is a complex subject that is widely misunderstood. When we talk about bank capital, we are talking about where a bank gets its money.