The Reserve Bank, New Zealand's central bank, has commenced a public consultation on a business continuity and crisis management regime for systemically important financial market infrastructures (SIFMIs). The proposed regime forms the final part of proposals the Bank published in December 2015 for a new oversight regime for SIFMIs.
The proposed regime has two parts. Firstly, SIFMIs would be required to maintain business continuity plans and recovery and wind-down plans. Secondly, the Reserve Bank and the FMA (joint regulators) could call on proposed new statutory powers when these plans are inadequate to manage a crisis.
"FMIs generally operate reliably and effectively in New Zealand, and overseas experience shows us that the serious failure of a systemically important FMI is rare," said Toby Fiennes, Head of Prudential Supervision. "However, it is important that we have the plans and tools in place to deal with the failure of a systemically important FMI, given the serious adverse effects this could have on the financial system. We welcome stakeholders’ feedback on the crisis management regime we are proposing."
The deadline for comments about the consultation document is 5pm local time, 20th May 2016.
Read the consultation document: ‘Crisis Management Powers for Systemically Important Financial Market Infrastructures’ (PDF)