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Thread: Banking guarantees in NZ

  1. #1
    migratingfishswim is offline Junior Member
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    Default Banking guarantees in NZ

    do NZ banks have a scheme guaranteeing one's savings? i know the UK does, so just assumed NZ is the same.

    if anyone knows, that'd be really helpful, thanks.
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  2. #2
    ExPat is offline Member
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    Quote Originally Posted by migratingfishswim View Post
    do NZ banks have a scheme guaranteeing one's savings? i know the UK does, so just assumed NZ is the same.

    if anyone knows, that'd be really helpful, thanks.
    NZ banks are NOT insured. This has been covered in a few other posts. If you bank fails, your money disappears. I would urge you to keep money with at least two different banks or one bank and some cash at home in a safe place.

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    kokopeli is offline God like figure
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    There was an interesting piece about this on the TV news last night.

    Seeing how NZ has relatively few urban centres, it's quite common to find branches of ANZ and National Bank side-by-side, on opposite sides of the street or just around the corner from one another. I suspect that when ANZ 'merged' with National, they had a long term plan to make closures where there were branches of the two banks in close proximity.

    This is a good example of a big corporation using the credit crunch as a smokescreen for large scale cost-cutting and hard nosed business strategy.

    Mark my words, everyone with a blue chequebook will have a green chequebook within the next 12 months!

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    Quote Originally Posted by migratingfishswim View Post
    do NZ banks have a scheme guaranteeing one's savings? i know the UK does, so just assumed NZ is the same.

    if anyone knows, that'd be really helpful, thanks.
    It's coming, but will it be in time?

    Labour announces deposit guarantees
    By VERNON SMALL - The Dominion Post | Sunday, 12 October 2008

    LATEST: Prime Minister Helen Clark has announced the Governnment will implement a deposit guarantee scheme as Labour launches its election campaign.

    The announcement follows a frantic week where European governments dramatically increased their deposit guarantees and world sharemarkets plummeted.

    Until now, New Zealand and Australia have been the only developed countries without some form of deposit insurance or guarantee. Australia was to introduce a limited deposit guarantee scheme into it's parliament this week.

    Miss Clark's speech this afternoon launching her campaign for a fourth term in office also outlined a potential economic stimulation package that would bring forward infrastructure spending, and fund projects in the construction and building sectors.

    That would include upgrades of the rail network between Palmerston North and Wellington and at the Marsden Point refinery.

    There would also be an accelerated road building programme, and faster development of new sewerage infrastructure.

    There would also be a new retraining allowance, another 1000 modern apprenticeships by 2011.

    "Labour will move to prepare a formal economic statement for release in December, setting out the steps to be taken to reignite the economy," she said.

    In a speech heavy on economic issues, she also attacked National's decision to scrap tax credits for research and development as a decision by "small minded, plodding, short termed focused conservatives".

    From here.
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    Govt offers banks total cover on all retail deposits
    5:31PM Sunday Oct 12, 2008

    The Government is offering to guarantee all retail bank deposits, Finance Minister Michael Cullen said today.

    Dr Cullen said he would use his powers under the Public Finance Act to introduce an opt-in retail deposit guarantee scheme.

    "The scheme will cover all retail deposits of participating New Zealand-registered banks and retail deposits by locals in non-bank deposit-taking entities. This would include building societies, credit unions and deposit-taking finance companies," he said.

    The new scheme is an opt-in scheme and would take the form of a bilateral contractual agreement between the Crown and the individual institutions which take up the guarantee.

    The scheme will be free for institutions with total retail deposits under $5 billion.

    A fee of 10 basis points per annum will be charged on total deposits above $5 billion.

    More here.
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    Aaargh! No mention of our HSBC bank joining. Really couldn't stand another hit with our Icelandic Isle of Man-based bank already crashed. Got money for a house purchase stuffed in there that won't go out until mid Jan.

    ANZ-National joins deposit plan, BNZ plans to
    Page 1 of 3 .... Updated 4:00PM Monday Oct 13, 2008

    Five banks have now joined up with the Government's new deposit guarantee scheme, with the BNZ also saying it intends to join.

    ASB Bank was the first of the big retail banks to say it would take part, with Government-owned Kiwibank also joining in early.

    This was followed by Westpac and newly registered SBS. ANZ National, the largest of the NZ banks, has just announced that it too will take part.

    "ANZ National is strong, well-capitalised and holds a AA credit rating from Standard & Poor's, putting it amongst the most highly-rated banking groups in the world" said bank chief executive Graham Hodges.

    "As Governor Bollard reiterated last week, the New Zealand banking system is fundamentally sound" he said.

    "However this guarantee scheme sends an important signal to New Zealanders and we're pleased to offer this reassurance to our customers who are understandably concerned by the impact of the global uncertainty."

    More here.
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    Default NZ compared to troubled Iceland

    BusinessWeek compares NZ to troubled Iceland
    1:00PM Wednesday Oct 15, 2008

    New Zealand is among 13 nations named by BusinessWeek as most at risk from the global financial crisis.

    The article compared New Zealand to Iceland because of its heavy dependence on foreign money to fund its current account deficit.

    "Like Iceland, New Zealand was a favourite of investors playing the yen carry trade. And like Iceland New Zealand is hurting," the American magazine said on its website.

    It noted the fall in the New Zealand dollar and that the New Zealand economy is already in recession.

    The New Zealand dollar hit new post float highs around US82c this year but has fallen in recent months and was US62c today.

    More here.
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    Mel John is offline Member
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    Please excuse my ignorance/ lack of knowledge in this area, but does it mean........ lets say for example .............. if I invested $100,000 with a bank that are signed up to the agreement...... & it all went pear shaped...... I would still get my $100,000 back???!!!!
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    I think it's still very much up in the air at the moment, Mel. A work in progress, you could say.

    Mr Key said he was comfortable the scheme would work with its broad thrust, but said there were still unanswered questions and possible changes to the scheme to be cleared up.

    These included extending the coverage of wholesale deposits as was being offered in Australia and some possible unintended consequences.


    We're still waiting to see if our Icelandic bank in the Isle of Man will honour its guarantees. Just because they make guarantees doesn't necessarily mean they will end up with enough funds to be able to honour them.
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    ExPat is offline Member
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    Expat continues to lick his chops in anticipation of feasting on collapsed home values in NZ soon.

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