Latest / Best of Business / Nicola Willis: Finance Minister on KiwiBank being given the green light to raise an additional $500 million

Transcript

Nicola Willis: Finance Minister on KiwiBank being given the green light to raise an additional $500 million · Best of Business

• 0:09
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  Speaker 1: Digging through the spinths to find the real story story.
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  Speaker 1: It's Heather Duples on Drive with One New Zealand Let's
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  Speaker 1: get connected News Talks EDB.
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  Speaker 2: Good afternoon. Can We Bank's got permission to partially privatize.
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  Speaker 2: It's going to raise half a billion dollars from investors
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  Speaker 2: to better compete with the big Aussie banks. Nikola Willis
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  Speaker 2: is the Finance Minister and with us, Hey Nikola, Hi, Ever,
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  Speaker 2: so who are you looking at for potential investors?
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  Speaker 1: Hi?
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  Speaker 3: A New Zealand super fund funds in the form of
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  Speaker 3: can we Saver Funds, potentially MARI Investment Entities and other
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  Speaker 3: funds that exist in the professional investment community in New Zealand.
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  Speaker 2: And they've already said they're interested.
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  Speaker 3: Yeah. So we've gone through a very comprehensive market sounding
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  Speaker 3: process over the last few months to see is are
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  Speaker 3: there people who've got the capital and would want to
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  Speaker 3: invest And we've engaged with key we sa A funds,
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  Speaker 3: investment institutions, professional investor groups and the like and that
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  Speaker 3: has given the Kiwi Bank and the government confidence that yes,
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  Speaker 3: this is a capital raise that can succeed. And so
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  Speaker 3: we're now moving to the formal process.
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  Speaker 2: Why not go bigger than five hundred million. You can
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  Speaker 2: go a lot bigger than this.
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  Speaker 3: Yeah, look, it's a really good question. Actually, Kiwi Bank
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  Speaker 3: is in the midst of a digital transformation and their
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  Speaker 3: view is that completing that is actually necessary before they
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  Speaker 3: go bigger. And in terms of the Crown getting the
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  Speaker 3: most value for its stake, that we will get more
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  Speaker 3: value in the future once that transformation has occurred. So
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  Speaker 3: at this point their ability to deploy more than half
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  Speaker 3: a billion dollars efficiently would be at risk. So we
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  Speaker 3: think this is the right bit for where they are
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  Speaker 3: in their growth.
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  Speaker 2: Chang okay, And so the half a billion dollars means
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  Speaker 2: your own ship steake as the government is what eighty
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  Speaker 2: percent still.
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  Speaker 3: Yeah, look, it will depend on the final issue size.
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  Speaker 3: We've said up to half a billion, it may not
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  Speaker 3: be that amount in the end, and of course what
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  Speaker 3: share of the business that represents will depend on the
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  Speaker 3: final issue price in the final structure of the deal.
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  Speaker 3: But we've set up to five hundred million is what
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  Speaker 3: we are up.
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  Speaker 2: For, and what's it going to take to get you
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  Speaker 2: to list it on the share market.
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  Speaker 3: Well, again back to this point one, we've said, look,
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  Speaker 3: let's get an electoral mandate before we do that, and
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  Speaker 3: so that will be for individual parties to take a
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  Speaker 3: position at the election. But I've been advised that any
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  Speaker 3: potential public offering couldn't take place before around twenty twenty
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  Speaker 3: eight because Qwbank will have needed to have successfully completed
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  Speaker 3: that transformation program to be appropriately positioned for that kind
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  Speaker 3: of listing on the stock exchange. So that will be
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  Speaker 3: something that I no doubt our national caucus will consider
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  Speaker 3: and take a position on prior to the election. But
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  Speaker 3: the advice I've received is pretty clear that the public
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  Speaker 3: markets are going to be the most accessible source of
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  Speaker 3: additional capital for Kewibank in the future. And I'm ambitious
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  Speaker 3: for Kiwibank's growth. So the idea of extra capital meaning
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  Speaker 3: that we get more lending, a more competitive banking market
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  Speaker 3: and textpayers aren't on the hook, that appeals to me.
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  Speaker 2: Yeah, absolutely, Hey do you know what cash Betel's doing here?
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  Speaker 3: No, I don't, but I am aware of cash Betel's presence.
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  Speaker 2: How are you aware of cash Hotel's presence?
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  Speaker 3: Ah, because there were a bunch of handsome men in
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  Speaker 3: suits on the seventh floor, and I said, who's in
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  Speaker 3: the building? Because these look like very serious people.
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  Speaker 2: Who's on the seventh floor? Are you on the seventh floor?
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  Speaker 3: Mm hmm.
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  Speaker 2: That means when he's on the seventh floor as well,
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  Speaker 2: doesn't it? So are they here to see Winston?
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  Speaker 3: Well? The only reason I had anything to say in
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  Speaker 3: answer to your question is because of that. So I'm
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  Speaker 3: probably being overly open.
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  Speaker 2: Haven't you. You've said too probably, Thank you, Nicola, I
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  Speaker 2: appreciate it. Nikola Willis Finance Minister or.
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