Leadership shift and capital review signal major growth phase
Kiwibank has welcomed the Reserve Bank’s review of capital settings, calling it a vital opportunity to support a more competitive and resilient banking sector.
The submission comes as Kiwibank enters a new phase of leadership and growth. Business leader Susan Peterson will succeed Jon Hartley as chair on Nov. 30 after six years in the role. The leadership change coincides with plans for a $500 million capital raise — a move Fitch Ratings says will not impact the bank’s strong AA credit rating.
In its submission to RBNZ, Kiwibank said the review can strike the right balance between competition and financial stability, ensuring the system encourages growth while protecting the economy from risk.
“At Kiwibank, everything we do is guided by our Purpose of Kiwi making Kiwi better off,” said Steve Jurkovich (pictured), Kiwibank’s chief executive.
“To do that, we need capital settings that support competition without compromising stability. We want to see a framework that ensures fairness by removing barriers for smaller banks that are looking to grow and innovate so Kiwi have genuine choice in banking.”
Kiwibank backs review but warns against overly conservative rules
Kiwibank said the review of key capital rules presents a chance to “level the playing field” for challenger and locally owned banks.
The bank supports RBNZ’s consultation proposals, including:
- More granular standardised risk weights to better reflect the risks of different lending types.
- Removing Additional Tier 1 capital to simplify and strengthen capital quality.
However, it warned that excessively conservative requirements could slow competition and innovation.
“As a challenger bank, Kiwibank needs sufficient capital to support strong growth, and excessive requirements create unnecessary barriers,” the NZ bank said.
Supporting fair growth and customer choice
Kiwibank argued that capital settings should not give any institution an advantage unless clearly justified by financial stability benefits, noting that fairer rules would improve access to finance and customer choice.
The bank’s submission urges RBNZ to consider a framework that fosters competition, supports innovation, and delivers better outcomes for Kiwi households and businesses.
“We want to see capital settings that support competition without compromising stability,” Jurkovich said. “That’s how we make Kiwi better off.”
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