The National Australia Bank (ASX:NAB) has responded to the Reserve Bank of New Zealand’s (RBNZ) proposed reforms.
The reforms, which are aimed at strengthening the New Zealand banking system include a potential increase to risk-weighted assets, and, an increase in the Tier 1 capital requirement to 16 per cent of the risk-weight average.
NAB says based on the proposals the recommendations would imply a tier 1 capital increase of NZ$4-5 billion for its New Zealand subsidiary, Bank of New Zealand.
However, NAB says the ultimate impact on the NAB Group will be dependent on various factors including the final outcome of the consultation.
Shares in NAB (ASX:NAB) closed 0.59 per cent lower at $23.55 yesterday.