Reserve Bank governor Graeme Wheeler has scotched claims by the Green Party that he has a bias in favour of the country's Australian-owned banks, and defended statements saying the lenders' return on equity is still below pre-crisis levels.
Wheeler, who delivers his maiden monetary policy statement on Thursday, released bank profitability figures given to the Greens, which he used to support comments before Parliament's finance and expenditure committee that bank profits were "about average or below" other developed nations. Greens co-leader Russel Norman accused Wheeler of misleading Parliament over the claim, which isn't directly addressed in the RBNZ statement.
Wheeler released charts showing New Zealand's banks' after-tax return on assets and equity between 2009 and 2001 was in the bottom half of OECD countries, excluding the euro-area. Pretax returns show New Zealand lenders' returns in the top six for the period. The comparisons aren't clean-cut with some countries shown as before tax, and others after tax.
"My response to the select committee represented my understanding of the information available at the time," Wheeler said in a statement. "Our analysis was completed after the hearing and we released to the Green Party in response to their request which followed the hearing."
The November 7 select committee hearing on the central bank's financial stability report was Wheeler's first appearance before politicians, and degenerated into a farce when the governor, his entourage, and everyone else were cleared from the room so MPs could argue about whether they could seek more time after a late start.
