The Financial Market Infrastructures Act 2021, also known as the FMI Act, established the RBNZ and the FMA as joint regulators of designated FMIs.
The RBNZ described FMIs as the plumbing of the financial system, as they enable electronic payments and financial market transactions to occur, making them essential for the day-to-day operation of the financial system and the wider economy.
According to RBNZ, effective regulation of FMIs is essential to promoting robust FMIs and protecting New Zealand’s financial system while facilitating efficient financial markets, which will ultimately support the economic wellbeing of New Zealanders.
Following a consultation on the content of the FMI standards held in the second half of 2021, the RBNZ and FMA have released exposure drafts of these standards, along with related guidance and a draft equivalence framework for overseas FMIs. The RBNZ and the FMA are accepting written feedback on these exposure drafts and related documents until Nov. 18.
“The proposed FMI standards would align the regulatory regime for FMIs in New Zealand with international best practice,” said Christian Hawkesby, RBNZ deputy governor and general manager of financial stability. “The binding requirements in the proposed FMI standards would complete the establishment of a modern regulatory regime for FMIs that is appropriate for New Zealand.”
“We thank industry and stakeholders who have helped inform the development of this work to date,” said Paul Gregory, FMA acting director of capital markets. “It is important we continue to hear these views and encourage interested parties to share their views on the proposed standards and guidance.”