Quarterly Statement by the Council of Financial Regulators – March 2022

The Council of Financial Regulators (CoFR) held its quarterly meeting on Tuesday 1 March. The meeting was chaired by Reserve Bank Governor Adrian Orr. The council welcomed the new FMA Chief Executive and CoFR co-chair Samantha Barrass.

Key items of discussion were the regulatory agenda for 2022, cyber resilience in the financial sector, the investigation into recent changes in the Credit Contracts and Consumer Finance Act (CCCFA), and the impact for New Zealand’s financial sector of the developing situation in Ukraine.

CoFR considered an updated Regulatory Initiatives Calendar for the New Zealand financial sector and endorsed this for publication. They noted that the regulatory agenda remained at capacity for both industry and regulators and undertook to identify initiatives that could be delayed should unforeseen circumstances arise during the year that would further negatively impact capacity.

CoFR agreed that cyber resilience across New Zealand’s financial system should be added to the list of priority themes. CoFR agreed to set up a cross agency community of experts to share information, and collaborate on initiatives in this space to build on the domestic cyber-attack protocols already under development.

CoFR discussed the ongoing investigation into the initial implementation of recent changes to the CCCFA. The objective of this investigation is to identify any impacts of the recent CCCFA changes that came into force on 1 December 2021, considering the scale and nature of the impacts, to assess what, if any, further actions are needed. Chief executives agreed to continue to provide input to the investigation being led by MBIE and that responsive action should be taken if the investigation reveals this is needed. Any changes however should be careful not to undermine the effectiveness of the regime in protecting New Zealanders from being burdened with unaffordable debt.

CoFR also considered the recent developments in Ukraine and the implications for New Zealand’s financial sector, particularly the implications of certain Russian banks being removed from the SWIFT international financial messaging system.