Latest / Best of Business / Barry Soper: Newstalk ZB senior political correspondent on New Zealand's banking sector making a profit amid economic downturn

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Barry Soper: Newstalk ZB senior political correspondent on New Zealand's banking sector making a profit amid economic downturn · Best of Business

• 0:09
  Speaker 1: You're listening to a podcast from News Talks B. Follow
• 0:12
  Speaker 1: this and our wide range of podcasts now on iHeartRadio.
• 0:16
  Speaker 2: News Talks B. Barry Soapers he has senior political correspondent.
• 0:19
  Speaker 2: Good afternoon, Barry afternoon, Ran, good to see you. Now
• 0:22
  Speaker 2: you've been having a look at two at this KPMG
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  Speaker 2: report on our banking sector, the margins that we pay,
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  Speaker 2: the margins that our banks earn here versus Australia, well.
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  Speaker 3: Not only Australia, other countries as well. We're in the
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  Speaker 3: middle to upper end in terms of the bank's profitability
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  Speaker 3: if you look at because we've got four big Australian
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  Speaker 3: banks operating in this country. Of course, they last year
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  Speaker 3: made a net profit of seven point two two billion dollars,
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  Speaker 3: which is extraordinary.
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  Speaker 2: But they're big, they're big outfut.
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  Speaker 3: Well no, no, but that's what they keep telling us.
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  Speaker 2: They're tens of thousands of employees.
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  Speaker 3: Yes they have all that, yes, I know. And the
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  Speaker 3: chief executives are back before the Select Committee at part
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  Speaker 3: this week. They're crying poor on their three million dollar salaries.
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  Speaker 3: I mean, it's a really tough area out there. But
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  Speaker 3: if you look at the banks, the margin is two
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  Speaker 3: point three four percent. Now that's the difference. The ocr
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  Speaker 3: is three point seventy five percent, So that's what they
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  Speaker 3: buy their money at, and their margin is two point
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  Speaker 3: three four percent, which would give you an interest rate
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  Speaker 3: of around I guess six percent, and that's what we
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  Speaker 3: should be paying in our mortgages. But you know, I
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  Speaker 3: don't think everybody's paying. Well, we're probably getting closer to
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  Speaker 3: six percent.
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  Speaker 2: It depends what sort of It depends on your situation,
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  Speaker 2: isn't it how much you're borrowing and what.
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  Speaker 3: You will well, yeah, right. The biggest problem here if
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  Speaker 3: you listen to the banks, and it's been reflected by
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  Speaker 3: some political circles as well, is the capital that they
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  Speaker 3: have to retain to make sure that if times do
• 2:03
  Speaker 3: get tough, that the deposit depositors funds will be looked
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  Speaker 3: after and and the like. So when you look at
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  Speaker 3: other countries, it's pretty high in New Zealand, mainly because
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  Speaker 3: our economy is in a pretty risky state at the.
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  Speaker 2: Moment, that's right, And we're a small country and we're
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  Speaker 2: one earthquake away from everything going to hell in a handbasket,
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  Speaker 2: So you know, yes, they might be making a little
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  Speaker 2: bit more money here but they in theory, we are
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  Speaker 2: safer here because they've got the capitol.
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  Speaker 3: But no bank has fallen over here either. And the
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  Speaker 3: thing is that with the new governor of the Reserve
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  Speaker 3: Bank coming in, because the Reserve Bank sets those capital requirements,
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  Speaker 3: maybe they'll be a bit more liberal and certainly that
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  Speaker 3: would appease some of the political circles.
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  Speaker 2: Now, speaking of political circles, Ginny Anderson, she did it again.
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  Speaker 2: This is on with on Breakfast on Hosking this morning.
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  Speaker 2: Her foot firmly buried in her mouth was what.
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  Speaker 3: I couldn't believe it when I heard it. It was
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  Speaker 3: like regular slot on Wednesday, Mark Mitchell with Mark Mitchell,
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  Speaker 3: she was moaning about what a waste time the eighty
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  Speaker 3: hours were for hearing submissions on the Treaties principal Bill
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  Speaker 3: when it was going to be voted down. Well, it
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  Speaker 3: was a great, great piece of radio in my view.
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  Speaker 3: The woman Chris Hopkins Rates promoting Ginny Anderson to Labour's
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  Speaker 3: finance team last week and making her responsible for treaty
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  Speaker 3: negotiations made a fool of herself when taking issue with
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  Speaker 3: Mitchell over the Treaty's bill. Ever, listen, Labor took some
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  Speaker 3: ofilar bills through themselves when they're in parliament. That got
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  Speaker 3: killed off as well.
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  Speaker 4: So but I think that you name it was a treaty.
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  Speaker 3: It was a treaty principal's bill that Labor brought into
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  Speaker 3: the House as well through the process making it. Can
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  Speaker 3: check your history, you don't, you don't treaties negotiated.
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  Speaker 5: Didn't know.
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  Speaker 3: I was right.
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  Speaker 4: Labor did not support it, honestly, that.
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  Speaker 3: Was her coming back after the break. So I was
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  Speaker 3: right all along. Well, in fact, Jenny, go back and
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  Speaker 3: have a listen, as all our listeners have heard, you
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  Speaker 3: were wrong.
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  Speaker 2: Hey, just finally the Maori Party, staying on a similar
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  Speaker 2: vein head, the Malori Party goes into bat for finner
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  Speaker 2: order agencies. These are the ones who've lost their contracts.
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  Speaker 2: We've heard about it in the last couple of days.
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  Speaker 2: One of them, of course, belongs to or is run
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  Speaker 2: by John Tamerheady, their president.
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  Speaker 3: It's a big it's a big contract and the person
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  Speaker 3: firing the questions today was the Maori parties co leaded
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  Speaker 3: every rewa Packer. She was accused in parliament today of
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  Speaker 3: asking questions on behalf of her party's president, John Tamma
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  Speaker 3: Harry who had one of the big contracts. But Louise Upston,
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  Speaker 3: standing in for the minister, says the transition to the
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  Speaker 3: new providers will be very carefully managed.
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  Speaker 4: The Department of Prime Minister and Cabinet and the Public
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  Speaker 4: Service Commission are working closely with Japuna Cookery to manage
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  Speaker 4: the transition and to ensure a smooth continuity of service
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  Speaker 4: for the FUNO receiving services. Okay, Roland will send it.
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  Speaker 5: Who does a provider that has banked over one hundred
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  Speaker 5: million dollars in profit not suggest that the taxpayers money
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  Speaker 5: has not gone.
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  Speaker 4: For the purpose which was given in the first place.
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  Speaker 4: This is a process that Puny Corcady have run, as
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  Speaker 4: recommended by MB that every contract that the government has
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  Speaker 4: should go to market every four to five years to
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  Speaker 4: test the market to see if there are other providers available.
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  Speaker 5: We've got a member asking pointed questions about a process
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  Speaker 5: in which one of the major losers appears to be
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  Speaker 5: a prominent member of her own political party. I just
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  Speaker 5: wonder if there's any need to declare such a conflict
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  Speaker 5: of interest before asking such questions.
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  Speaker 3: Well, the Speaker decided there wasn't any need to do it,
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  Speaker 3: and I didn't planny of not Rewhitpackers' questions because they
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  Speaker 3: are all superficial, really, and they didn't elicit anything but
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  Speaker 3: the fact that she's clearly upset about the contract being lost,
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  Speaker 3: and there is certainly, in my view, something of a
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  Speaker 3: conflict there when you consider she's asking about a contract
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  Speaker 3: that or one of the contracts that was held by
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  Speaker 3: the party president John Tammy, A bit of.
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  Speaker 2: A stinct you reckon, Verry. Thank you for that. Barry Soper,
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  Speaker 2: Senior political correspondent here at news TALKSB.
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