RBNZ approves $8.7 bln for two banks

The Reserve Bank has agreed to accept billions of dollars of housing loans as security from two major banks should they run short of cash, according to a report on the state broadcaster Radio NZ. The central bank has approved the purchase of residential mortgage-backed securities worth $8.7 billion from the ANZ National and the Westpac banks. The banks are the first to take up the Reserve Bank's offer to provide extra liquidity during the global financial crisis. Westpac says it has not drawn on the facility yet but may if market conditions remain difficult. The Radio NZ report is here >>>