Reserve Bank of New Zealand
In 2020, KangaNews launched its Women in Capital Markets Yearbook with a focus on amplifying female voices in the Australian market. The publication received widespread positive response, including requests from New Zealand to bring a similar project to the other side of the Tasman Sea. On 8 March this year – International Women’s Day – KangaNews hosted its first roundtable discussion exclusively featuring female leaders in the New Zealand debt market. The event was not just to discuss gender diversity but to provide a forum for their voices at a key moment of market development.
Updates in early 2021 confirm that there will be no reprieve for the international IBOR complex and only a temporary stay of execution for some specific rates. Market participants say Australasia – where rates based on bank bills will continue to exist, at least for the time being – is still insufficiently engaged with the transition process, including in the context of all-important cross-currency swaps.
Housing affordability has been a critical issue in New Zealand for some time but a price explosion in 2020 has heightened the national focus. The government has announced a suite of policies to tackle the issue but efforts to press gang monetary and regulatory policy into service have run into resistance.
The Basel Committee on Banking Supervision published a report on 14 April detailing the transmission mechanisms of physical and transition climate risks into financial stability risk. Risks can be observed through traditional lenses, but the committee says more research is needed fully to understand the potential impact of climate change on the financial system.
On 10 March, the Reserve Bank of New Zealand (RBNZ) announced it will end its term auction facility and corporate open market operations on 16 March. The support mechanisms allowed banks to borrow short-term funds using eligible collateral and were part of the RBNZ’s emergency response to the COVID-19 crisis in March 2020.
As environmental, social and governance issues become ever-more integrated with the credit investment process in Australia, the issue of pricing consequences for strong and weak performers is more relevant than ever. This is no longer just a question for direct emitters but also for companies with business models adjacent to emissions-intensive industries.