Record bank profitability nothing to celebrate

Record, excessive profits in the banking industry and the high level of foreign ownership of the banking sector is causing long-term damage to the economy, the Green Party said today.

KPMG's latest Financial Institutions Performance Survey found New Zealand's banks posted record collective profits up 6.9 percent to reach an all-time high of $5.17 billion last year. Interest margins are also at ten-year highs at 2.28 percent.

“The fact that over 90 percent of our banking sector is foreign-owned means that most of those billions of dollars of record profits are flowing offshore, contributing to our number one economic problem – a high and persistent current account deficit,” said Green Party finance spokesperson Julie Anne Genter.

“Four massive Australian banks continue to dominate our banking industry and are among the most profitable banks in the developed world.

“Record profitability comes at the cost of New Zealand businesses and households that are paying higher borrowing costs and bank fees than is reasonable.

“Banking is yet another sector where Government inaction favours big foreign companies over our own.”

The Green Party has issued a challenge to the National Government to increase competition in our banking sector by strengthening Kiwibank and other New Zealand-owned banks and credit unions.

“A strong Kiwibank is an integral part of a smart, green economy,” Ms Genter said.

“By injecting capital into Kiwibank and allowing it, in time, to become the Government’s banker, we can increase its capacity to compete fairly with the much bigger Australian banks.

“It’s time the Government built up our New Zealand-owned banks and credit unions rather than let our foreign-owned banks strip our economy of capital.”

Latest Finance Announcements

Story

Inquiry into COVID-19 economic response necessary

The Green Party is again calling on the Government to review the economic response to COVID-19, as the Reserve Bank of New Zealand puts up the Offi...
Read More

Story

Budget 2022: James Shaw Budget Speech

CHECK AGAINST DELIVERY Mr Speaker, It has taken four-and-a-half years to even start to turn the legacy of inaction and neglect from the last time t...
Read More

Story

Rising household costs hurting low-income people

The Green Party says the Government needs to do more for those on the lowest incomes as inflation outpaces wage and benefit increases.
Read More

Story

Greens call for urgent action to fix tax system

The Green Party is urging the Government to take urgent action to create a fairer tax system that works for all New Zealanders.
Read More

Story

Urgent action needed to soften inflation blow for low income NZers

The Green Party says urgent action is needed to soften the blow of inflation for New Zealanders on the lowest incomes.
Read More

Story

Liveable incomes and rent controls, now

Stats NZ’s monthly rental and food price indexes released today continue to show that over the last 12 months the essentials have gotten increasing...
Read More