However, Robertson confirmed to the Herald the Government remained committed to passing the bill before the election, and having the regime set up in 2024. It said the “length and complexity” of the bill were “pertinent” and offered to advise Robertson on what could be done if issues raised during the select committee process slowed progress to the point the bill couldn’t be passed before the election. The RBNZ noted the legislation to establish the scheme was introduced to Parliament two months later than planned, in September 2022, and consultation by the finance and expenditure committee overlapped with the Christmas break. The regulator sought Robertson’s view on an amended timeline, which could see the scheme operational by September 2024 at the earliest, or January 2025 as another option. Its establishment will mean New Zealand is no longer an outlier in the OECD for not having such a scheme and will come on top of the Reserve Bank (RBNZ) requiring banks to hold more capital.Ī document released to the Herald under the Official Information Act shows the RBNZ on November 21 wrote to Finance Minister Grant Robertson to explain how difficult it would be to get the scheme running by early 2024. Work on the scheme began in 2017, well before the pandemic and Silicon Valley Bank and Credit Suisse ran into trouble. The scheme will be funded by levies paid by deposit-takers and backstopped by the Crown. If they spread their $300,000 evenly across two banks that both collapsed, they’d get $100,000 back from each bank. So, if someone had $300,000 of savings at a bank that collapsed, they’d get $100,000 back. The proposed scheme will see $100,000 of deposits per person or business, per institution, insured. The Government’s depositor compensation scheme is on track to being operational by late 2024, rather than early 2024, as previously anticipated. Photo / SuppliedĮstablishing an insurance scheme to protect depositors in the event of their bank, finance company, building society or credit union collapsing is taking a little longer than expected. Bank and non-bank deposits likely to be insured by 2024.
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