The bank's funding and liquidity positions remain sound, the bank says
Kiwibank has acknowledged that it did not comply with its liquidity calculation obligations.
RBNZ said Kiwibank’s Condition of Registration 13 requires the state-owned bank to calculate the one-week mismatch ratio, the one-month mismatch ratio, and the one-year core funding ratio in accordance with the methodology prescribed in BS13 (Liquidity Policy) and BS13A (Liquidity Policy Annex: Liquid Assets) most recently issued in May 2021.
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RBNZ’s Liquidity Thematic Review, published in 2021, as well internal reviews by Kiwibank and an independent review of Kiwibank, identified a series of quantitative areas of non-compliance where Kiwibank was not calculating the ratios in accordance with BS13, breaching its Conditions of Registration.
The Reserve Bank said an assessment of the findings of non-compliance with BS13 against the materiality factors outlined in the guidance on reporting by banks of breaches of regulatory requirements, found that they do not individually constitute a material breach of Kiwibank’s Condition of Registration 13.
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“As noted by the Reserve Bank, Kiwibank’s regulatory liquidity ratios remained well above its own internal limits and the central bank’s minimum regulatory ratios,” Kiwibank said in a media release. “This means Kiwibank’s funding and liquidity positions always remained sound, and the bank is well capitalised.”
Kiwibank said it has engaged constructively with the central bank prior to and during the Reserve Bank’s Liquidity Thematic Review and has agreed a plan to continue to remediate outstanding issues.
