Latest / Early Edition with Ryan Bridge / David Tripe: Massey University Banking Expert on the Commerce Commission's report into the New Zealand banking sector

Transcript

David Tripe: Massey University Banking Expert on the Commerce Commission's report into the New Zealand banking sector · Early Edition with Ryan Bridge

• 0:00
  Speaker 1: You would have seen the recommendations the final report from
• 0:02
  Speaker 1: the ComCom the Commerce Commission yesterday fourteen recommendations to make
• 0:06
  Speaker 1: our banking sector more competitive. Among those was an idea
• 0:10
  Speaker 1: to beef up Kiwibank, and this is something the government
• 0:13
  Speaker 1: is looking at. Nikola Willis says she's investigating, and she
• 0:16
  Speaker 1: was on this show last Thursday and asked her about
• 0:20
  Speaker 1: whether she would float, potentially float partially float key Bank
• 0:24
  Speaker 1: on the stock exchange and what she thought about foreign ownership.
• 0:28
  Speaker 1: Would you rule out foreign investment in Kibank?
• 0:31
  Speaker 2: Well, look, I'm taking advice on what is needed to
• 0:34
  Speaker 2: get investment into Kiwibank. And if I say, I've said,
• 0:38
  Speaker 2: let's look at what the options are.
• 0:40
  Speaker 1: So how could these options shake down? David Trump is
• 0:43
  Speaker 1: massive university banking expert. He's with us this morning. David,
• 0:46
  Speaker 1: good morning, Good morning Ryan. How do you best help
• 0:51
  Speaker 1: Keeybank raise capital? Is the what would be the smartest approach?
• 0:54
  Speaker 1: Do you think?
• 0:56
  Speaker 2: Oh, I'm certainly some partial soil to the New Zealand
• 1:02
  Speaker 2: public would be one way of going ahead with that.
• 1:06
  Speaker 2: It wouldn't. It will take them time to absorb a
• 1:11
  Speaker 2: large amount of capital, so that's probably better done. As
• 1:16
  Speaker 2: a relatively slow process. On the other hand, just giving
• 1:21
  Speaker 2: them small and providing some more amounts of capital, it
• 1:24
  Speaker 2: isn't going to mean that they're going to grow very rapidly,
• 1:26
  Speaker 2: but trying to have them have to have a bank
• 1:30
  Speaker 2: grow rapidly as usually a recided.
• 1:31
  Speaker 1: The disaster true, what is the Key We Bank done
• 1:35
  Speaker 1: in the past, because when they have had access to
• 1:38
  Speaker 1: extra capital in the past, have they used it for expanding.
• 1:43
  Speaker 2: Generally? On the other hand, they got some more capital
• 1:46
  Speaker 2: about August last year and they've only partially used that
• 1:53
  Speaker 2: so far, so that processes that process has been relatively slow.
• 1:59
  Speaker 2: Now I've read something about how they're spending money on
• 2:02
  Speaker 2: digitalization again that that's that's not necessarily a bad thing,
• 2:08
  Speaker 2: and that's one of the things that they would need
• 2:10
  Speaker 2: to do if they were to expand significantly.
• 2:12
  Speaker 1: Anyway, does in your mind, does Key We Bank need
• 2:14
  Speaker 1: to be key We owned.
• 2:19
  Speaker 2: There's no necessity for any bank to be under any
• 2:21
  Speaker 2: particular country's ownership. What has happened in recent years is
• 2:27
  Speaker 2: that operating banks across borders has become has been made
• 2:32
  Speaker 2: more challenging by international regulation. So that may that might
• 2:41
  Speaker 2: that might limit foreigners will enlisted by KEW Bank outright,
• 2:46
  Speaker 2: but that's a step down the road that we haven't
• 2:52
  Speaker 2: got to yet.
• 2:52
  Speaker 1: All right, thanks so much for your tom This morning,
• 2:54
  Speaker 1: David Truent, Massi University banking expert talking about the ComCom recommendations,
• 2:59
  Speaker 1: one of which is to give Kiwibank a big boost
• 3:03
  Speaker 1: so that they can be more of a player on
• 3:05
  Speaker 1: the local market.
• 3:05
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• 3:09
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• 3:10
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• 3:13
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