Regulatory Alerts2022-05-17
Consultation Paper BS16: Capital Recognition, Repayment, and Related Amendments
The Reserve Bank of New Zealand proposes formalizing the process for registered banks to obtain notices of non-objection for Additional Tier 1 and Tier 2 capital instruments under BS16. The consultation introduces stricter Board attestations, mandatory legal opinions for write-off mechanisms, prior notification for significant CET1 repayments, and oversight of secondary market purchases. Additionally, minor amendments are proposed to BS2A and BS2B to align capital definitions with industry practice and clarify counterparty credit risk legal opinion requirements.
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