Consumer NZ chief executive Jon Duffy said it seemed a sensible move.<\/p>\n
\u201cIt seems sensible to put these costs on a highly profitable industry,\u201d he said.<\/p>\n
\u201cThere is potential for these costs to be passed through to consumers, but it\u2019s really too early to tell.\u201d<\/p>\n
New Zealand Banking Association chief executive Roger Beaumont said banks understood the need for appropriate funding for regulators.<\/p>\n
\u201cBanks will engage constructively with the Reserve Bank in the consultation process to help make the levy appropriate, effective, and well targeted,\u201d Beaumont said in an emailed statement.<\/p>\n
A spokesman for the Insurance Council of New Zealand said: \u201cWe look forward to engaging constructively with officials to ensure the approach is effective and proportionate.\u201d<\/p>\n
Willis said the Government\u2019s approach was consistent with international practice in countries like Australia, Canada and the United Kingdom.<\/p>\n
\u201cThis levy will ensure the cost of regulation and supervision is borne by financial market players rather than taxpayers,\u201d she said.<\/p>\n
The prudential levy is estimated to recover around $209 million over the next four years.<\/p>\n
The levy will be paid to the Reserve Bank, with the revenue returned to the Government through an increased dividend.<\/p>\n
Speaking after the Budget was delivered, both Willis and Prime Minister Christopher Luxon warned banks not to pass on the cost of new levies to New Zealand customers.<\/p>\n
\u201cYou are some of the most profitable companies in the country. You do very well for yourselves. Do not put extra costs on to your New Zealand customers,\u201d Willis said.<\/p>\n
The Reserve Bank will commence consultation with the sector following the Budget. Cabinet is aiming to make decisions in early 2027, with a view to the levy being introduced in mid-2027.<\/p>\n
The revenue from the new levy will be less than 1% of the total profits of the big four banks alone.<\/p>\n
The big four Australian-owned banks, and the much smaller Kiwibank, earned a total of $7.48 billion in their most recent financial years.<\/p>\n
The Reserve Bank\u2019s prudential responsibilities include licensing entities to operate in New Zealand, developing and issuing prudential requirements imposed on regulated entities and monitoring the financial health of entities.<\/p>\n
The levy will apply to deposit-takers, insurers and financial market infrastructure providers.<\/p>\n
There are currently 27 registered banks and 14 licensed non-bank deposit takers in New Zealand and 81 insurers.<\/p>\n
Jamie Gray is an Auckland-based journalist, covering the financial markets, the primary sector and energy. He joined the Herald in 2011.<\/p>\n
Stay ahead with the latest market moves, corporate updates, and economic insights by subscribing to our\u00a0Business newsletter<\/a>\u00a0\u2013 your essential weekly round-up of all the business news you need.<\/p>\n Do you have questions about the Budget? Ask our experts \u2013 business editor at large Liam Dann, senior political correspondent Audrey Young and Wellington business editor Jen\u00e9e Tibshraeny \u2013 in a Herald Premium online Q&A here at nzherald.co.nz<\/a> at 9.30am, Friday, May 29.<\/p>\n","protected":false},"excerpt":{"rendered":"Consumer NZ chief executive Jon Duffy said it seemed a sensible move. \u201cIt seems sensible to put these…\n","protected":false},"author":2,"featured_media":449069,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[2246,20145,11357,138,14107,3311,802,124,59518,4381,219,246,9189,2082,191,700,96885,4960,117,111,139,69,2515,12975,8218],"class_list":["post-449068","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-2246","tag-blog","tag-budget","tag-business","tag-click","tag-consumer","tag-costs","tag-could","tag-coverage","tag-customers","tag-economy","tag-finance","tag-follow","tag-for","tag-here","tag-latest","tag-levy","tag-live","tag-new","tag-new-zealand","tag-newzealand","tag-nz","tag-raise","tag-sector","tag-warns"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/449068","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=449068"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/449068\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/449069"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=449068"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=449068"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=449068"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}