National revives plan to let private NZ investors buy into Kiwibank, RNZ reports

If National is re-elected, it will revisit opening the state-owned Kiwibank to local private investors so it can compete with the big Australian-owned banks, RNZ and 1News report. Finance spokesperson Nicola Willis called the idea a "win-win solution" and said her party would have more to say during the campaign. The election is on 7 November.

What happened

The idea is not new. Last year the Government gave Kiwibank the go-ahead to sound out local investors, including KiwiSaver providers, interest.co.nz and the NZ Herald reported.

Kiwibank's parent, Kiwi Group Capital, later scrapped that plan. It said it had talked to investors, but its capital settings had eased after Reserve Bank changes and it had raised $400 million in bonds. Interest.co.nz reported the bank said it could keep growing without extra equity. In May this year the parent company's chairman said it would look at "all the potential options for capital", with work on growth scenarios at an early stage.

What it means for you

The four big Australian-owned banks hold about 84 percent of bank lending; Kiwibank holds just over 6 percent (RBNZ, NZ Herald).

Selling shares would dilute the Government's ownership, so taxpayers would own a smaller share of a bank they currently own outright.

Who says what

NZ First leader Winston Peters has said he would not entertain a partial sale, 1News reported in May, although NZ First has also been reported as open to private investment in the merged bank it wants. The party is proposing that the Crown buy BNZ from NAB and merge it with Kiwibank.

Greens, Te Pāti Māori and Opportunity have not been reported by these outlets as stating a Kiwibank ownership position.

What happens next

Any sale would be a decision for the next government and for Kiwi Group Capital, which has to decide whether the bank needs outside money at all.

Our take

Kiwibank's owner, the Government, has said it wants the bank to grow. The question is how that growth is paid for: by taxpayers, by retained earnings, or by outside investors. Last year the bank's parent said it did not need new equity. Parties have put forward different ideas, and more detail is promised before 7 November. We will report each party's Kiwibank policy as it is released. Check the parties' own policy pages.