International Monetary Fund. Monetary and Capital Markets Department
INTERNATIONAL MONETARY FUND
The regulatory and oversight framework for Financial Market Infrastructures (FMIs) in New Zealand is undergoing a major reform. The Reserve Bank of New Zealand (RBNZ) and the Financial Markets Authority (FMA) currently lack sufficient legal powers to identify and address risks building up in FMIs, partly because the regime is voluntary and the authorities do not have the appropriate toolkit to pursue their oversight objectives. This may give rise to negative externalities as the interests of members and shareholders of FMIs are not necessarily aligned with public interest objectives. Recognizing the shortcomings of the current regime, the authorities are proposing to develop a new regime. These reforms have been consulted on with industry during recent years.