RBNZ releases risk management guidelines for non-banks

The Reserve Bank has released its risk management programme guidelines for non-bank deposit takers. Reserve Bank Deputy Governor Grant Spencer said the guidelines helped build the new prudential regime for deposit taking finance companies, building societies and credit unions. These non-banks are now required to have a risk management programme from September 1 this year. The programme needs to show how they will identify and manage credit risk, liquidity risk, market risk and operational risks, appropriate to each institution's particular circumstances, the RBNZ said. Mr Spencer said risk management programmes will also need to show how an institution plans to address stress events that could disrupt their business, and identify the responsibilities of governing bodies and senior management. "The Bank received many useful submissions in response to the draft guidelines released for public consultation in June. Submissions were generally supportive of the guidelines," Mr Spencer said. The Reserve Bank has also provided responses to questions raised in submissions, which can be found on the Bank's website here. Here is the full 10 page document below with the guidelines. RBNZRiskManagement1307 We'll update this article further with details. Meanwhile, in our quest for collaborative journalism, we encourage our readers to comment and analyse our article and the documents cited to strengthen the article.