9. STUART NASH (Labour) Link to this
to the Minister of Finance
Does he stand by his statement on 15 June that “taxpayers are supporting the banks, and we want the banks to be able to demonstrate that they are going to support businesses and households through a tough time in the economy, even if it affects their profits a bit”?
Hon BILL ENGLISHWhat contact have the Minister, his staff, and his officials had, directly or through intermediaries, with the ANZ National Bank, BNZ, ASB, Westpac, Kiwibank, or PSIS since the announcement last Tuesday of the Opposition parties’ inquiry into banks?
I, the officials I am directly responsible for in Treasury, and, I suppose, those I am indirectly in contact with through the Reserve Bank have regular discussions with the banks. Announcements made by the Opposition have no impact on that whatsoever.
Does the Minister agree with the Governor of the Reserve Bank’s comments that the pricing of floating rate mortgages appears unusually high in recent months; if so, why has he not supported the governor’s recommendation around an inquiry into the relationship between the official cash rate and interest rates charged on floating mortgages?
Yes, I agree with the Reserve Bank’s analysis. Members are free to do whatever they like, but I advise the member now, if he is not aware of it, that an inquiry by Opposition MPs probably will not make any difference.
Peseta Sam Lotu-Iiga Link to this
Tēnā koe, Mr Speaker. Has the Minister seen any reports on interest rates and bank margins over the last decade?
I have seen a couple of reports. The first, which is on the Reserve Bank’s website, shows that average interest rates on floating mortgages peaked at 10.9 percent in May 2008. I also point out the Reserve Bank’s Financial Stability Report, which shows that bank margins peaked in 2003, stayed at historic highs until quite recently, and are now at historic lows. I am a bit surprised that those Opposition members who were in Government for all of that time are now saying that these margins are too high. My question to them asks what they did about it while they were in Government.