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New Zealand's approach to bank supervision

John Turner (School of Public Policy, Economics and Law, University of Ulster, Newtownabbey)
Peter Oyelere (Lecturer in accountancy in the Commerce Division, Lincoln University (New Zealand))

Journal of Financial Regulation and Compliance

ISSN: 1358-1988

Article publication date: 1 March 1999

111

Abstract

In the aftermath of the banking crisis in South‐East Asia, the International Monetary Fund (IMF) has recommended that the South‐East Asian economies adopt several aspects of the New Zealand approach to bank supervision. The New Zealand approach relies heavily upon market incentives. This paper analyses three key aspects of the New Zealand supervisory regime: the removal of deposit insurance; the public disclosure regime; and the Reserve Bank of New Zealand's supervisory responsibilities. In this paper, we argue that this supervisory regime is built on weak foundations, and therefore, it should not be emulated by other economies.

Citation

Turner, J. and Oyelere, P. (1999), "New Zealand's approach to bank supervision", Journal of Financial Regulation and Compliance, Vol. 7 No. 3, pp. 250-255. https://doi.org/10.1108/eb025013

Publisher

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MCB UP Ltd

Copyright © 1999, MCB UP Limited

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