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Government to end wholesale bank guarantee from April 30
Finance Minister Bill English has announced that New Zealand's government guarantee for wholesale bond issues by banks will end on April 30, following the end of a similar Australian guarantee from March 31.
The guarantee was used by New Zealand's banks to issue NZ$10.3 billion worth of bonds under 24 guarantee certificates. There have been no payouts and the guarantee fees earned the government NZ$290 million in fees, English said.
The guarantee was set up in November 2008 in the middle of the financial crisis after Australia's government set up a similar scheme.
"It helped our banks access funding during that crisis, but international market conditions have improved and continue to improve in 2010," English told the New Zealand-Australia Investment Forum in Auckland today.
New Zealand banks are now raising funds without using the guarantee, which was always envisaged as a temporary measure for extraordinary times," English said.
The lifting of the guarantee showed "our markets have normalised and New Zealand is a good place to invest."
15 Comments
Bill English says - The
Bill English says - The lifting of the guarantee showed “our markets have normalised and New Zealand is a good place to invest.”
Would you invest in a country of 4 million people that is borrowing $250 million per WEEK to stay afloat? And he's the Minister of Finance!
when dollars are that big
when dollars are that big it isn't money anymore, just numbers, clients, profits and collateral damage.
the quick and the dead
If "our markets have normalised"...why
If "our markets have normalised"...why is the ocr at 2.5? What a load of BS from BE.
Why the BS from BE?....simple really...if he doesn't go with the spin and claim Noddyland is equal to aussie...think what the money markets would realise...you got it...somebody has a bloody big Elephant sitting on his head.
do you own a dog
do you own a dog , Wally?
NZ isn't and never has
NZ isn't and never has been seen as a good place to invest (as in long term), but a brilliant place to speculate. Right from the early days and the NZ Company. Small economy, little corruption, few restrictions on foreign ownership, volatile currency, weak regulators.... Puppet on a string...Boom and bust
he's between a rock and
he's between a rock and a hard place. One must maintain a semblance of discipline on a sloping deck - cut him some slack guys!
If he's worked out that having too many kids was the maths that tipped us over the brink - sorry Steven I do go on - then he won't be up to much pummeling.
Take pithy on the epithanising, I say!
powerdownkiwi Says: "One must maintain
powerdownkiwi Says: "One must maintain a semblance of discipline on a sloping deck – cut him some slack guys!"
So it's OK for a Government minister to lie, provided he's in trouble? Par for the course I's say.
Andy Rodgers - "Would you
Andy Rodgers - "Would you invest in a country of 4 million people that is borrowing $250 million per WEEK to stay afloat?"
Well, better than the US which is borrowing $392 million per week for every 4.36million people!....
This is what happens to
This is what happens to countries that run a continuous trade deficit, Murray. Ultimatley the populace end up having to sell of what they have to repay 'their' debt, and why some see another drop in US housing and stock markets. What else have people got? Certianly no savings.
rob of the north...hell no
rob of the north...hell no mate...the dogs here on the farm are free to go whenever they like...I know what's coming down the road from those B....... in wgtn, dog 'owners' having to pay and pay again..Soon as they(the dogs on the farm)suss out the latch on their free luxury accomodation units(bigger than Auckland apartments!)
Murray - so the US
Murray - so the US has a bigger borrowing problem than NZ. That doesn't mean that NZ is still a good place to invest.
As a layman trying to
As a layman trying to follow the world financial crises, I now have an opinion that the western world has destroyed the value of its varied currencies. From my very amateur viewpoint it seems probable that in the not too distant future we will see horrendous levels of inflation. Does this not mean that after the chaos of such a 'sorting out period' our debts will no longer be much of a problem. At least we should be able to feed ourselves.
Wrong way around, Didge. Price
Wrong way around, Didge. Price Inflation does its destructive work if people can borrow more and bid up prices. Traditionally inflation works when its rate is high and debt low. What have we got this time? Low inflation rate and high debt. Borrow today, and the debt is just as likely to cost you more in tomorrows money. Also; how much do you think it will cost to feed yourself in the future?
It depends - there's a
It depends - there's a free-market chance that your bank ends up in the hands of a warlord. too.
Your loan is raised to 100%, and the warlord soon owns your property.
Then you get asked: Death or slavery?
Of course it wouldn't happen here......
You know its bad when
You know its bad when even though a little sideplate benefit from something thats is in the greater scheme of things bad is hailed as good.
We receive a kick back of $290 million to secure $10 odd billion of loans that were created out of freshair to be paid back in the future, what a deal.
If $100 million is 10% of a billion, what percentage is 290 of 10 billion?
As this was nothing more than a merry money go round the Treasury adviced that these fees not be portrayed as outright profit on govt books, but what to the con artists do, they hail it from the roof tops.
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