Banks rally on Reserve Bank capital decision
The S&P/NZX 50 Index advanced 47.92 points, or 0.4 percent, to 11,257.79. Within the index, 25 stocks rose, 17 fell, and eight were unchanged. Turnover was $103.1 million.
Australia’s four pillars – Westpac Banking Corp, Commonwealth Bank of Australia, National Australia Bank and Australia & New Zealand Banking Group – rallied on the ASX after New Zealand’s Reserve Bank granted a longer transition period for lenders to adapt to new rules requiring them to hold more capital. The central bank also stepped back from demanding all the extra capital be equity.
ANZ – New Zealand’s biggest lender – said it would need to retain $1.5 billion of local profit and was confident it wouldn’t need to raise additional equity. Its dual-listed shares rose 2.1 percent to $25.92 on the NZX.
Westpac increased 0.3 percent to $25.40 on the NZX. The company said it would need a further $2.9 billion of tier 1 capital to meet the new requirements by 2027. ASB Bank-owner CBA said it was well placed to manage the new capital requirements. NAB said the impact would depend on a number of factors, such as subsidiary BNZ's balance sheet through the transition period and any mitigating actions.
Click the button below to subscribe and will have free unlimited access for a limited time to full article and all other articles on the site.
You will also be able to comment on articles on Good Returns.
![[Weekly Wrap] KiwiSaver in play; but outcome unclear](https://goodreturns.publit.io/file/c_fill,w_300,h_200/0ad582e4-c9a3-4692-bbe2-62d928f77fd2.jpg)
