Reserve Bank consults on a crisis management regime

24 March 2016

Reserve Bank consults on a crisis management regime for financial market infrastructures

The Reserve Bank today began public consultation on a crisis management regime for systemically important financial market infrastructures (SIFMIs). The proposed regime forms the final part of proposals the Bank published in December 2015 for a new oversight regime for SIFMIs.

The proposed crisis management regime has two parts. First, SIFMIs would be required to maintain business continuity plans and recovery and wind-down plans. Second, the Reserve Bank and the FMA (joint regulators) could call on proposed new statutory powers when these plans are inadequate to manage a crisis.

“FMIs generally operate reliably and effectively in New Zealand, and overseas experience shows us that the serious failure of a systemically important FMI is rare,” said Toby Fiennes, Head of Prudential Supervision.

“However, it is important that we have the plans and tools in place to deal with the failure of a systemically important FMI, given the serious adverse effects this could have on the financial system. We welcome stakeholders’ feedback on the crisis management regime we are proposing.”

Submissions on the consultation document close 5pm, 20 May 2016.

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