RBNZ says offshore, wholesale funded non-bank financial institutions shouldn't be dragged into its non-bank deposit taker regulatory regime

By Gareth Vaughan

GE Capital, the country's biggest finance company, looks set to remain outside the Reserve Bank's prudential regulatory regime established to oversee major non-bank financial institutions.

The Reserve Bank has released a review of the prudential regime for non-bank deposit takers (NBDTs), which Finance Minister Bill English says the Government will consider over the next few months.

The review looked at the very definition of what an NBDT is. The NBDT rules are designed to cover finance companies, building societies and credit unions that borrow money from the public.But, in a consultation paper issued earlier this year, the Reserve Bank raised the possibility of changing the definition of an NBDT to ensure it better catches entities likely to raise systemic risks in the NBDT sector, including through lending as well as borrowing.

This is an abridged version of this article. The full version was published in our email for paid subscribers. See here for more details and to subscribe.