Council of Financial Regulators Forward Plan for Regulatory Initiatives Affecting the Financial Sector

30 September 2020 Council of Financial Regulators Regulatory initiatives affecting the financial sector – forward plan Group Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 All firms Consultation closes:  Consumer Data Right (5 Oct) (MBIE) Consultations start:  Review of Financial Strength dashboard (possible scope extensions) (RBNZ)  Standards for banknote-processing machines (RBNZ) Consultation starts:  Executive accountability regime (MBIE + RBNZ, FMA) Consultation starts:  Principles-based guidance on cyber-resilience (RBNZ) Banks Consultation closes:  Review of the Reserve Bank Act – prudential regime for deposit takers and deposit insurance (23 Oct) (Treasury & RBNZ)  Select committee process likely to commence on the Reserve Bank of New Zealand Bill (Treasury) Consultations start:  Capital requirements for banks - Exposure draft on the capital review (RBNZ)  Standard terms for Residential Mortgage Obligations (RBNZ)  Restructure of Banking Supervision handbook (RBNZ)  Encumbrance policy (RBNZ)  Revised process for approving banks’ internal capital adequacy models for credit risk (RBNZ)  Regulations for the Conduct of Financial Institutions regime (MBIE) Implementation:  Breach reporting and materiality (RBNZ): implementation work to be restarted in October 2020 – breach reporting to start from 1 January 2021  Preparation for potential Negative OCR (RBNZ) – to be completed by 1 December 2020 Consultations start:  Review of the Dual Registration and branch policy (RBNZ)  Standardised measurement approach to operational risk (RBNZ) Consultation starts:  Large exposures policy review (RBNZ) Consultations start:  Likely exposure draft of the legislation for deposit takers and deposit insurance (Treasury & RBNZ)  Counter-cyclical capital buffer (RBNZ) Insurers Consultations start:  Review of Earthquake Commission Act (Treasury)  Review of the Insurance (Prudential Supervision) Act 2010 (RBNZ) – consultation on scope and treatment of overseas insurers  Review of insurance solvency standards (RBNZ)  Availability of information on risk and insurance for consumers (Treasury)  Regulations for the Conduct of Financial Institutions regime (MBIE) Consultation starts:  Exposure draft of legislation for Insurance Contract Law review (MBIE) Consultation continues:  Review of Earthquake Commission Act (Treasury) Consultation starts:  Exposure draft of interim solvency standards (RBNZ) Managed investment schemes / KiwiSaver providers Request for proposals:  Review of KiwiSaver default providers (MBIE and the Treasury)

Page 2 Group Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Managed investment schemes / KiwiSaver providers Return to normal:  Restricted schemes member confirmation notice (FMA) - Usual requirements apply again from 1 November 2020 (after two month extension) Industry survey:  Thematic review on liquidity management (FMA) – Two part industry survey. First released early August, second currently scheduled early November Financial advisors Results of consultation:  Standard conditions/Application guide for full licensing (FMA) Commencement:  New financial advice regime in force from 15 Mar 2021 (FMA) Credit providers Expiry of temporary measure:  Addendum to Responsible Lending Code – expires 31 Mar 2021 (extended from 30 Nov 2020) Consultation starts:  Further amendments to the Responsible Lending Code Commencement:  Fit and proper certification: applications open – 1 June 2021 (ComCom) Commencement:  New requirements under the CCLAA – 1 Oct 2021  New duties on directors and senior managers – 1 Oct 2021  Directors and senior managers to be certified by 1 Oct 2021 Auditors Return to normal:  Audit Quality Reviews - BAU, had been deferred (FMA) Financial Market Infrastructures Consultation starts: Proposed Standards under the FMI Bill (RBNZ/FMA). Initiatives where timing to be confirmed Financial institutions  Requirement to report annually on climate risks – due to come into force by 2023, subject to Parliamentary approval (FMA and External Reporting Board) Banks  Liquidity policy (BS13) – thematic and policy reviews (RBNZ)  Review of stress-testing framework and conducting bank stress-tests (RBNZ)  Residential Mortgage Backed Securities (RMBS): development of high grade RMBS standard to address shortages of high quality liquid assets (RBNZ)