Are NZ Banks Insured?

[ExPat]

In the US, most banks are members of FDIC (Federal Deposit Insurance Corporation). Membership in FDIC means that if the bank loses money through theft, fire, incompetence, etc the FDIC will reimburse customers for up to $100,000 USD of deposits held in bank.

Is there something similar in NZ or is banking at a bank at your risk?

You should take a read of the Reserve Bank of New Zealand website( http://www.rbnz.govt.nz ) as it contains all the regulations that banks must conform to, plus everything else about NZ banks. I have no doubt that banks have insurance, it would be suicide not to.

This part of the site is probably of interest:

http://www.rbnz.govt.nz/crisismgmt/

[ExPat]

Thanks Taffy,

I did a little digging and found this link from the one you gave:

Bank deposit insurance and why we don't have it in New Zealand

basically, it states that the Bank of NZ DOES NOT have insurance for its deposits. In reading the crisis management page, it seems to state that in the event of a failure, the government would bail out the bank but I'm not clear on how it would do that.

There is no mention of what happens when a crack group of theives steals millions from a branch similar to what recently happened in the UK. Do depositers lose their funds?

If that's the case, I may have to invest in a vault.

I very much doubt there is enough money in any one branch to seriously affect anyones funds if such a robbery were to occur. In fact, even in the busiest branch in Auckland, I doubt they even hold as much cash as they spend on advertising in a year.

I expect if a bank did have difficulty, that the govt would help with funds from the crisis managment money they hold.