House Resumes Debating Covered Bonds

by Desk Editor on Thursday, November 21, 2013 — 9:19 AM

The House resumed at 9am under Urgency.

Leave was given to have one debate on all parts of the Reserve Bank of New Zealand (Covered Bonds) Amendment Bill in its committee stage.

The bill puts in a regulatory regime to oversee financial institutions use of covered bonds to raise capital.

Covered bonds have become increasingly common with banks issuing securities covered by mortgages or other loans. There is currently little regulation of their use and there are concerns about their increasing popularity. The fear is they may become too large a proportion of a bank’s risks as they are usually ranked higher for repayment of debt should a bank fall over.

The bill is supported by Labour though MPs have expressed concern about banks use of covered bonds.

The following business remains in the Urgency Motion:

The committee stage and remaining stages of the Non-bank Deposit Takers Bill, Statutes Amendment Bill, Unit Titles Amendment Bill and the Medicines Amendment Bill.

The first readings and referral to select committee of the Parole Amendment Bill, Immigration Amendment Bill (No 2) and the Objectionable Publications and Indecency Legislation Bill.
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