Most New Zealanders would struggle to explain what bank capital requirements are, let alone why they matter. Yet the Reserve Bank’s controversial 2019 decision to nearly double these requirements affects every mortgage holder and business borrower in the country.

After years of criticism, the bank (RBNZ) finally began a review of that decision, releasing proposals for consultation in late August. Submissions closed last week. But what is proposed are little more than tweaks. Fundamental questions about regulatory gold-plating remain unanswered.

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