Partial Sell-Off of Kiwibank Back on New Zealand's Government Agenda
New Zealand's government has put long-term growth options for state-owned Kiwibank back on the table, including a possible partial sell-off. Under the new directive, the bank will review strategic alternatives. The goal is to boost competition in the country's retail banking market.
New Zealand's Treasury has instructed Kiwibank to review its long-term growth strategy. In a statement, the Treasury said a possible partial privatisation is among the options under consideration. The bank has had to limit its growth rate in recent years due to constraints on its capital base.
Kiwibank stands out as the country's only large state-owned bank competing with foreign-owned rivals, primarily the four major Australian banks. Officials say strengthening its capital base will allow it to offer more competitive terms to retail and small-business customers. An independent advisory panel will oversee the review process.
The Labour opposition has urged the government to spell out safeguards against any shares being sold to foreign investors. The finance minister said any shares would only be offered to New Zealand institutional and retail investors. The detailed framework will be submitted to parliament by the end of the year.
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