In a recent communication, RBNZ highlighted that it has made available the data on financial health of banks registered in New Zealand, for up March 31, 2020. The dashboard for the quarter ending on March 2020 was produced on time amid the COVID-19 pandemic. Toby Fiennes of RBNZ pointed out that Bank Financial Strength Dashboard has been one of the key initiatives of RBNZ for disclosures amid COVID-19 crisis. The dashboard makes it easier to compare the relative risks and financial position of different banks and is more timely than disclosure statements. RBNZ plans to review the dashboard for banks, launch a related consultation in the first quarter of 2021, and explore a prudential disclosure dashboard for the insurance and non-bank deposit-taker sectors.
RBNZ discussed with banks on how to present information on some of the relief packages—such as mortgage deferrals—resulting in creation of different categories to the existing reporting classifications of banks. The key metrics covered in the dashboard are capital adequacy, asset quality, profitability, balance sheet, liquidity, issuer credit ratings, and nonperforming loan ratios of banks. RBNZ will be reviewing the dashboard starting later this year, partly to ensure it maintains a relevant picture of new emerging risks such as cyber and climate related risks. The review will also refresh some of the existing content, including adding or changing metrics, adding some new interactive features, and reviewing the publication process. The user community will be encouraged to provide their input on how to make the dashboard better. RBNZ will hold a public consultation to collect this feedback, most likely in the first quarter of 2021 and would aim to refresh the dashboard in late 2021. Along with the refresh, RBNZ is exploring a prudential disclosure dashboard for the insurance and non-bank deposit-taker sectors. RBNZ intends to begin consultation with insurers and non-bank deposit-takers in the last quarter of this year. A number of sector participants have been wanting data that is comparable across the industry. The insurance dashboard will be linked with the Insurance (Prudential Supervision) Act review and the review of insurer solvency standards, both of which are being relaunched in the fourth quarter of this year, following a delay due to COVID-19 outbreak.
Keywords: Asia Pacific, New Zealand, Banking, COVID-19, Bank Financial Strength Dashboard, Disclosures, ESG, Reporting, Climate Change Risk, Basel, RBNZ
Dr. Denton provides industry leadership in the quantification of sustainability issues, climate risk, trade credit and emerging lending risks. His deep foundations in market and credit risk provide critical perspectives on how climate/sustainability risks can be measured, communicated and used to drive commercial opportunities, policy, strategy, and compliance. He supports corporate clients and financial institutions in leveraging Moody’s tools and capabilities to improve decision-making and compliance capabilities, with particular focus on the energy, agriculture and physical commodities industries.
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