tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Friday, October 11th, 6:54PM

News

rss
Latest Headlines

Industry should ignore Nat pledge to scrap CoFi: KPMG

The National Party's pledge to scrap the Financial Markets (Conduct of Institutions) Amendment Act 2022 (CoFi) “threw a spanner in the works” but businesses should regard it as an opportunity to improve their business, according to accounting firm KPMG.

Wednesday, September 27th 2023, 6:00AM 5 Comments

by Jenny Ruth

Writing in KPMG's latest quarterly report on the performance of financial institutions, KPMG's risk consulting director Kate Stewart and colleague Malcolm Bruce say CoFi “actually provides opportunity for financial institutions to do what's right for their business, as well as the customers they serve.”

The announcement by National leader Chris Luxon at the Financial Services Council conference last month “created a level of uncertainty into what has been a well-accepted regulatory change,” say Bruce and Stewart, who joined KPMG from the Financial Markets Authority (FMA).

The CoFi legislation “essentially brings banks, insurers and non-bank deposit takers into a regulatory regime that would provide protections for consumers that don't currently exist in New Zealand's regulatory landscape,” they say.

“It's hard to argue institutions should not treat their customers fairly, nor that they should have customers at the heart of the way their businesses operate.”

They note the industry has been “pretty slow” at getting ready to apply for licences and to implement any changes needed for compliance – the Act comes into force at the end of March 2025 but licensing opened in July this year.

The KMPG writers note that CoFi is principles-based rather than a set of rules, and argue that institutions should be using it to “really think differently about CoFi as not just a piece of regulatory change, but as an opportunity to build in fair treatment for their customers at the design stage,” they say.

That would make firms “compliant by design, which can assist in demonstrating what they're doing for customers as well as provide benefits for their institutions.”

Some institutions are full-steam-ahead in preparing for the changes, but others “have pushed the pause button” but face “a major risk” in delaying further work on CoFi.

Without CoFi, the industry faces the major risk that the FMA will launch more court action.

The KPMG writers note the FMA “has used the powers they already have in the Financial Markets Conduct Act” to tackle misleading and deceptive conduct and “enforce against the most egregious examples of what were frankly a sloppy and careless approach to customers.”

Implementing CoFi requires institutions to do some “deep thinking” about what “fair” really means and to have “tough conversations” about existing policies or processes, they say.

Tags: CoFI

« [The Wrap] FSC should take a position on CoFIFinancial Advice NZ CEO hangs up her boots »

Special Offers

Comments from our readers

On 28 September 2023 at 11:27 pm Murray Weatherston said:
I wonder if KPMG would be prepared to publish how much revenue they have made from FIs over the last 12 months consulting on CoFI?
On 29 September 2023 at 10:25 am JeffQV said:
CoFI is a totally unnecessary piece of complexity that would do nothing to protect the consumer and would only add to the costs of the provider (therefore the consumer). Good riddance.
On 29 September 2023 at 6:34 pm JPHale said:
JeffQV, so what would you suggest given the big end of town has shown to be the problem for consumers?
On 29 September 2023 at 7:06 pm Murray Weatherston said:
@JP
Here's a weekend challenge for you.
How about you make a list of all the times you know a BEOT FI has caused a problem with a brief explanation of what the problem each time was.
Maybe I and other sceptics of the need for CoFI will see the obvious errors of our way when we see the list and agree to enrol for re-education /sarc.
On 3 October 2023 at 7:20 am JPHale said:
:D Murray, I have better things to do. Maybe read a few of my articles on FI behaviour.

I’m sure in the investment space things have improved and there's less concern than there was. But there's been plenty of FI type stuff in the past.

Activities of banks and insurers, not your usual product set, have been hugely problematic and still continue to be.

In the mortgage and insurance space we have seen with reporting its not advisers but the FI’s. GR has covered the fines handed out to them recently.

Do we need CoFI? Yes. Have you seen the impacts, maybe not.

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Weekly Wrap

Previous News
Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 5.94 - - -
AIA - Go Home Loans 8.49 ▼6.19 ▼5.69 ▼5.69
ANZ ▼7.89 6.79 6.29 6.29
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 6.19 5.69 5.69
ASB Bank 8.39 ▼6.19 ▼5.69 ▼5.69
ASB Better Homes Top Up - - - 1.00
Avanti Finance 8.90 - - -
Basecorp Finance 9.60 - - -
BNZ - Classic - 6.19 5.79 5.79
Lender Flt 1yr 2yr 3yr
BNZ - Mortgage One ▼7.94 - - -
BNZ - Rapid Repay ▼7.94 - - -
BNZ - Std ▼7.94 6.45 5.89 5.79
BNZ - TotalMoney ▼7.94 - - -
CFML 321 Loans 6.70 - - -
CFML Home Loans 6.95 - - -
CFML Prime Loans 8.75 - - -
CFML Standard Loans 9.70 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - ▼5.99 - -
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Owner Occ 8.15 ▼6.19 ▼5.75 5.69
Co-operative Bank - Standard 8.15 ▼6.69 ▼6.25 6.19
Credit Union Auckland 7.70 - - -
First Credit Union Special - 6.60 6.10 -
First Credit Union Standard 8.50 7.20 6.70 -
Heartland Bank - Online 7.99 6.69 6.35 6.15
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.00 6.50 -
ICBC 7.49 6.15 5.69 5.69
Kainga Ora 8.39 7.05 6.59 6.49
Kainga Ora - First Home Buyer Special - - - -
Lender Flt 1yr 2yr 3yr
Kiwibank 8.25 7.19 6.69 6.59
Kiwibank - Offset 8.25 - - -
Kiwibank Special - 6.29 5.79 5.79
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 8.75 6.69 6.19 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
SBS Bank 8.49 ▼6.95 ▼6.29 ▼6.29
SBS Bank Special - ▼6.35 ▼5.69 ▼5.69
SBS Construction lending for FHB - - - -
Lender Flt 1yr 2yr 3yr
SBS FirstHome Combo 5.94 5.45 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
TSB Bank 9.19 7.09 6.59 6.59
TSB Special 8.39 6.29 5.79 5.79
Unity 8.64 6.29 5.79 -
Unity First Home Buyer special - 6.20 - -
Wairarapa Building Society 8.50 ▼6.50 ▼5.89 -
Westpac 8.39 6.89 6.39 6.39
Westpac Choices Everyday 8.49 - - -
Westpac Offset 8.39 - - -
Lender Flt 1yr 2yr 3yr
Westpac Special - 6.29 5.79 5.79
Median 8.39 6.47 6.10 5.79

Last updated: 12 October 2024 6:37pm

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox  |  Disclaimer
 
Site by Web Developer and eyelovedesign.com