Regulatory Alerts2026-07-27
Added · Updated
BPR120 Capital Adequacy Process Requirements - 1 October 2026
This document establishes process requirements for New Zealand-incorporated registered banks regarding capital adequacy, including mandatory notification and legal sign-off procedures for issuing Tier 2 and mutual capital instruments. It imposes notification obligations for capital redemptions, purchases of own capital, and amendments to capital instruments, while restricting funding of own capital purchases to prevent circular funding exceeding 5% of total outstanding instruments. The Reserve Bank may require capital restoration or recapitalisation plans if a bank's prudential capital buffer ratio falls below specified triggers, and IRB-accredited banks must obtain approval for changes to internal risk models.
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