RBNZ says don't believe what banks say about capital

“Shareholders’ view of capital will always be lower in the banking sector than is good for the country,” Bascand told NZSA’s annual conference in Christchurch at the weekend.

“If a bank says it should be this much, know it should be more than that.”

Nevertheless, Bascand acknowledged that how much more capital than banks think they ought to have is a fair matter for debate.

RBNZ has proposed to near double the minimum amount of tier 1 common equity capital the four major banks have to hold, from 8.5 percent of risk-weighted assets currently to 16 percent. Smaller banks will have to hold 15 percent.