New Zealand banks and insurers returns $93.86m after conduct and culture review

The joint review of banks and life insurers was conducted between 2018 to 2019.

New Zealand banks and life insurers return $93,86m following the conduct and culture review jointly held by the Financial Markets Authority (FMA) and the Reserve Bank of New Zealand from 2018 to 2019.

The financial institutions were asked to report on any issues requiring remediation, and this update reflects the continuing efforts to review their practices and systems.

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“The remediation work shows the extent of weaknesses in the systems and processes across banks and life insurers. This demonstrates the significant amount of work required by financial institutions to ensure they are identifying, rectifying, and remediating issues which, to date, have impacted over 1.5 million customers with a total sum of NZ$150m ($93.86m) returned so far,” Clare Bolingford, Director for Banking and Insurance at the FMA said.

Last month the FMA revealed, for the life insurance sector, 225 such issues resulting from creaking systems and weak controls, showing nearly half a million customers impacted, and more than $26.91m paid in remediation. These figures represent just one-third of issues whose impacts have been fully assessed to date. 

Bolingford said they acknowledge the substantial work by banks and insurers to fix their customer issues, especially those firms tracing further than they had to.

“We note that over the past 12 months boards have displayed a greater understanding of what needs to occur to achieve consistent fair customer treatment. It is likely there’s more self-reporting to come as firms continue these efforts. The more firms have looked, the more problems they’ve found. You can reasonably expect our future monitoring activities to consider how well firms have completed, and reported on, these matters,” Bolingford said.