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NZ First's Winston Peters blames 'subservient puppetized NZ politicians' for the lack of a probe into the NZ banking system. Says Aussie banks are 'like a hole in the hull of the NZ economy'

NZ First's Winston Peters blames 'subservient puppetized NZ politicians' for the lack of a probe into the NZ banking system. Says Aussie banks are 'like a hole in the hull of the NZ economy'

By Gareth Vaughan

New Zealand First leader Winston Peters, who may hold the balance of power after the September 23 election, is calling for a banking inquiry focusing on bank charges, the dominance of Australian owned banks in New Zealand, and bolstering NZ ownership in the sector.

Peters told that a key problem currently is the "extraction of over $4 billion in profits" out of the NZ economy as a consequence of Australian dominance of NZ banking through the Australian owned ANZ, ASB, BNZ and Westpac.

"That's a huge amount of money coming out of an economy in any given year. When the BNZ was sold [in 1992] six out of 10 banking clients were with the BNZ. That was a massive loss. We're saying this level of foreign ownership, and in key institutions, is seriously bad for our economy because it disguises the state of the economy as it relates to benefits for New Zealanders," Peters said.

In their most recent completed financial years, ANZ, ASB, BNZ and Westpac posted combined net profit after tax of $4.331 billion. They paid combined dividends of $2.68 billion, equivalent to 62% of their combined net profit after tax. Analysis from the Bank for International Settlements (BIS), the central banks' bank, and shows the profitability of the major NZ banks ranks near the top of the pack when compared to a range of banks from other countries.

Opinion polls place Peters and NZ First in the box seat to be kingmaker and determine which parties form the Government after the election. Speaking at the NZ First convention on Sunday, Peters pledged that during the nine weeks until the election NZ First will "lay out our policy and manifesto in the 'Battle for New Zealand'."

'Bringing the banking sector back into NZ ownership'

If in government Peters says NZ First will begin "the long overdue process" of bringing the banking sector back into NZ ownership. According to the Reserve Bank, the four Australian owned banks account for almost 90% of aggregate bank assets in NZ. 

"As a first step we will make Kiwibank the Government’s official trading bank. It is absurd that a foreign bank Westpac should be clipping the ticket on all the NZ Government’s business and financial transactions," Peters says.

In a public tender of the Government's banking business in 2015, the first since the late 1980s, Westpac retained its role as key transactional banking service provider for another eight years. At that time a Kiwibank spokesman told the Government owned bank didn't have the capability to be a full blown tenderer. Kiwibank was, however, named as one of five government bill payment service providers alongside ANZ, ASB, BNZ and Westpac. 

'Taxpayers money is going into Westpac right now so what would the difference be?'

Asked whether he is proposing tipping taxpayers' money into Kiwibank to build the bank into a position where it could takeover all the Government's business, Peters said, "Taxpayers money is going into Westpac right now so what would the difference be? The benefit of course would be that the money would be staying in our economy, not going offshore. Right now the taxpayer's helping the Aussie banks, and helping Westpac in particular. If you think that's justifiable why aren't we helping our own? I can't imagine for a moment that the Japanese, Chinese or Singaporeans would think this is a smart idea so why would we?"

 In their recent budgets both the Australian Federal Government and South Australian State Government announced levies on ANZ, ASB's parent Commonwealth Bank of Australia, BNZ's parent National Australia Bank, Westpac and Macquarie. Asked if this was something he wanted to do if in government to, say, help fund Kiwibank, Peters said he wasn't going to make policy up on the hoof.

"But let me say this. In Australia at the Federal level they would have had four or five inquiries into banking charges with respect to their own banks charging Australians. In New Zealand nothing."

"Why is it justifiable for Australia to do that to their banks and not for us to do it to their banks? It's inexplicable." 

'Commonsense shouldn't have to be a bottom line'

 On its website NZ First says it wants to "conduct a review of the foreign-owned banks focusing on competition, how much tax they are paying and how we can grow our own New Zealand banking sector." ANZ, ASB, BNZ and Westpac are described as being "like a hole in the hull of the New Zealand economy."

Peters told he envisages the review would be led by "an appropriate independent person with the experience to conduct the inquiry." Asked whether such a banking inquiry is a bottom line from a NZ First perspective heading into the election, Peters said commonsense shouldn't have to be a bottom line.

"Why would it not be justifiable in New Zealand when Australians think it's warranted in Australia? You've got a bunch of subservient puppetized [NZ] politicians who won't act in the national interests of business and private citizens," said Peters.

Recent Australian inquiries have included the 2014-15 Financial System Inquiry, a Parliamentary Review of Australia's four major banks, and the Sedgwick review of bank commissions and payments.

Peters said he wants to see Kiwibank as a dominant full service bank in the NZ banking sector for the same reason BNZ was established in the 1860s.

"To give New Zealand bank users a fair go. That's why it [BNZ] was established and that's why it should never have been sold off," Peters said.

"What would [ex-Singapore Prime Minister] Lee Kuan Yew do here, what would he think was commonsense?"

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Attempting to Bring NZ banking to NZ and NZers is going to provoke quite a reaction from vested interests.
Would most NZers agree with WP on this?

It will get votes, but it is all hot air

WP ideas are nice to have, very patriotic and true as much as they are hard to implement - 'Battle for New Zealand' ?? ... I guess the profits are higher because their lending books are getting bigger ... But anyways, The question is Do we need another Wine Box enquiry again? and Should we rock that big boat with all its affiliates ?? what could possibly be the consequences for doing that ??

Where did the AUSsies get to with theirs?

How is that going to sit with his future coalition partners?? that will be interesting to watch


JK is getting the highest Australian honor, I have been trying to work out why, I can not think of anything above what any other PM has done (apart from CER)
but then he is a bankers best friend and the big 4 Australian banks have made record profits in NZ whilst he was in power off the back of massive debt creation, which they have sent back home
maybe its the conspiracy theorist in me Hmmmm


There's also the fact Kiwis' rights in Australia have massively eroded in that time, not to mention Key was a supporter of Australia sending rapists and murderers back to NZ (ridiculing objections to this in parliament) if they've lived in Aussie most of their life but don't have citizenship. So these have benefited Australia.

Deceptive misinformation - they are not rights - they "were" privileges

Until 2001 NZers had a unique set of privileges in Australia. Every NZer travelling to Australia, permanently or otherwise, had a responsibility to all of New Zealand to protect those privileges. Unfortunately there have been too many ratbags that did not care and had no regard for those that would come after them

Australia is a very unforgiving place - it treats all arrivals equally regardless of country of origin. NZ enjoyed a set of privileges that no other country did until Helen Clark gave citizenship to a heap of overstayers in NZ who all promptly left to go to Australia - that one governmental decision plus the actions of the overstayers spoilt it for the rest of NZ - As for JK being a supporter - he got no choice in the matter

See following article in NZ Herald
This is the type of behaviour that spoils it for the genuine kiwi and ruins our reputation
He didn't care. But, does he cares now? Doesn't look like it.

This guy meets your criteria of someone who was born in NZ but has lived most of his life in Australia. As a born in NZ he meets the criteria to be called a Kiwi but he is obviously not Maori and not Pakeha. His family is a back-door entry into NZ then back-door into Australia. This is why Australia closed its doors when NZ gave amnesty to 1000's of pacifika overstayers in 2001. He has made over $100,000 from his various crimes but will arrive back in NZ broke. NZ has to accept him and cannot deport him back to his roots

It's rather ambitious to try to call that deceptive misinformation - for practical purposes the words right and privilege work fine, e.g. rights can be given and taken away just as privileges can be, and media coverage will often use right as a synonym of ability, e.g. "Kiwis have the right to _____ when living in _______".

Yes, I'm aware Key and our politicians raised no strident objections to Kiwis privileges being removed so they no longer align with the rights Aussies living in NZ have. Equally, Key could've addressed the issue started by Clark...but instead, has seemed far too dependent on immigration for economic growth, so did nothing to address that factor, instead overseeing a massive increase.


@Rick Strauss , let me just let you in on a secret .......... most rational thinking New Zealanders would also like to send murders and rapists in jail here , back to where they came from.

True, fair point.


Seems a reasonable way to connect the dots. JK is literally laughing all the way to the bank.

I can picture him now weighed down into a hunch by the "double gongs" laughing like an evil professor and mumbling "crisis, what crisis?"


He came, he saw, he dithered, he left.

He is still around, collecting.


Well he created Corporate New Zealand where big business rules the waves. We as taxpayers are as such, of just as little value as any minority shareholder in any big corporate, and treated accordingly.

NZ government self-sabotages itself every time

Australian banks have been here forever - the mistake the NZ government made was allowing these same banks to get into the mortgage home lending business after 1980 by taking over the life insurers and building societies

Hey Winston what about the Insurance duopoly? Enough duplicity there one would think, especially around the CHCH earthquake fiasco, to make the bankers look like real nice guys.

NZ does not need to own the banks, NZ just needs a regulator who will implement proper constraints on banks, such as requiring sufficient bank capital, and actually putting in place a meaningful DTI limit. The banks cannot purloin NZ's wealth if their lending is properly constrained.

Actually NZ Bank fees are quite low compared with some countries

I was surprised to see charges on basic accounts, cards etc when I moved here from the UK. I don't think I had any fees from my bank in the UK apart from foreign exchange, and that was cheaper than over here too.

I would consider voting for WP but first he would have to announce which way he would go BEFORE the election. Sorry but you simply cannot place a $1 bet "Each way" when it comes to politics so as far as I'm concerned he is not getting my vote when a vote for him could be for the "other lot" you don't want in. Why take that risk ? you want to be voting for who you want to get in and WP is just the opening act with a couple of songs to try and grab votes.

Such clarity of thinking

While you are at it explain how can you vote for either of the 2 major parties who (for want of a better word) will be held to ransom and will make concessions to him. He could possibly go with the party that gives him the most of his demands. But then again he might decide to simply sit on the cross-benches and force a minority government to bargain every day, every inch of the way

I would vote for WP if he would go with National.

You do realise that WP wants to ban foreign buyers (of existing homes) and lower immigration. This would reduce rental demand and likely lower house prices in your precious DGZ. Lose/lose for you:-(

Yes I do realise that but it is better than Labour.

It is unlikely that WP would have that much power in a National-NZFirst coalition. WP is ex National person as well.

You are joking, right?
Expect to see WP front and center of any government he forms.

Not joking at all. You think he would become dictator of NZ? He would have to have the support of National MPs and others to get things passed. At worst things would probably stay dead-locked which would likely be a good thing.

A good thing, though? - definitely not.
You will fast see your quality of life decrease over the next term and further if fundamental changes aren't made soon.

Double- GZ, capital gain tax was on WP wish list.. so be careful who you are throwing your vote to

Same here if he went with National pre-election but can he be trusted ? I think his decision not to announce who he will go with will ultimately cost him votes when people are actually in the polling station and ticking a box.

Judging by the number of NZers who have accounts with the big 4,most NZers don't care who owns the banks

I care, am with KB and very happy with them.

In politics being successful is all about making the right noise and WP is doing just that !

One solution to this Banking problem might be for the Cullen Fund/NZ Super Fund to buy Shares of one or two of the Big Aussie Banks !!!! The Super Fund has the Coin to do it. Then the Bank Dividends would return to NZ. Then we would all benefit.
Or alternatively Kiwi Saver Funds could buy Shares of the Aussie Banks -- they are all freely trading on the Australian and the NZ Stock EXchange .

Wouldn't it be best to wait until after the housing crash so the AU banks take the losses first?


All these comments are silly. National will win alone and with the usual suspects.
The big surprise will be (and take it from me) the Greens will go National, before they go Labour.
As usual, you heard it from me first, but choose to stick your fingers in your ears, singing "la la la la!"

I recently rang Kiwibank wanting to arrange a mortgage for a property purchase and felt patriotic to support the home team.
After listening to answer phone music for 30 mins I gave up and rang my Aussie bank and had it sorted in minutes with a favorable interest rate.

Upgrade front line response,keep interest rates more than competitive,fair fees, lets see the Govt use it and show us they have confidence in it, make it the only Bank to implement like the Australian Government has a guarantee for deposits up to $250,000. I and most of NZ should and probably will then support it.
Without the guarantee economies of scale make Kiwi Bank a greater risk than the larger foreign owned Banks, for pete's sake if the Govt doesn't even use it and it doesn't have the guarantee as a point of difference, if we are so sure Kiwi Bank is the answer use the (Cullen Fund/NZ Super Fund) as the insurance policy