Grant Robertson has kicked off a review of the ownership of Kiwibank's parent company, which could see the bank directly owned by the Government, or - in theory at least - sold to private investors.
In recent weeks the Treasury has appointed Goldman Sachs to examine options for the ultimate ownership of Kiwi Group Holdings, the parent company of Kiwibank as well as wealth manager and Kiwisaver provider KiwiWealth, Kiwi Insurance and New Zealand Home Loans.
While Robertson's office has not commented directly on the review, in a statement the Minister of Finance appeared to confirm the way Kiwibank was owned was under discussion. The statement appears to hint that, whatever the outcome, Kiwi Group would remain in public ownership in some form.
"Ministers and officials are currently considering the best ways for the Crown to express its ownership interest."
Founded in 2002 on the back of a campaign by Alliance Party leader Jim Anderton to increase competition among retail banks, Kiwibank was originally wholly owned by NZ Post, with hundreds of post offices also serving as bank branches.
Cornerstone shareholdings in Kiwi Group Holdings were sold to the New Zealand Superannuation Fund (25 per cent) and Accident Compensation Corporation (22 per cent) in 2016.
The two Crown entities paid $494 million for the stakes, with NZ Post's then-chairman, former deputy prime minister Sir Michael Cullen, saying the deal gave Kiwibank access to capital and commercial expertise, while keeping it completely under public ownership.
For the first five years, the owners were only able to sell shares to each other, however the restrictions ended at the end of October (2021).
Since then, the three shareholders have the option to sell to outside investors, although the New Zealand Government has the first right of refusal on any sale outside the current shareholders.
The latest review is believed to have been triggered by at least one of Kiwi Group's shareholders expressing a desire to sell its stake.
NZ Post, which has faced a multi-year battle to maintain a profitable nationwide mail delivery service, has long been seen as a constraint on Kiwibank's growth.
A spokeswoman for NZ Post said the organisation "does not have abnormal capital constraints". NZ Post would continue to hold its 53 per cent shareholding "unless advised otherwise by our shareholder".
ACC refused to comment.
NZ Super "remains supportive of Kiwibank Group Holdings" a spokesman said, adding that Kiwibank "has been a strong asset for the fund". The fund is not allowed to own a controlling stake in any of its investee companies.
As well as new capital requirements from the Reserve Bank, Kiwibank appears to have ambitions to grow, which would likely necessitate a further injection of capital.
"Our focus is to support even more Kiwi businesses to grow, invest or diversify in the year ahead," Kiwibank chief executive Steve Jurkovich said in August, as Kiwibank revealed its profits had more than doubled to $126m in the year to June 30.
A separation from NZ Post appears to have been happening for some time.
Over the past decade, Kiwibank has begun opening stand-alone bank branches and pulling out of Post Offices, while many Post Offices which operated as dual bank and post services were closed as NZ Post retrenched.
A spokeswoman for Kiwibank said the separation of the branch network was completed in July 2021, although in some of the 101 locations where service agents (such as stationary shops and pharmacies) offer Kiwibank services, services were also offered on behalf of NZ Post. There are 62 corporate standalone Kiwibank branches.
Determining the price at which Kiwibank's shareholdings should change hands could be a complex process, with advisers likely to have to come up with a theoretical price at which a qualifying buyer (who would have to meet Overseas Investment Office tests and Reserve Bank approval) might pay.
Kiwi Wealth recently sold Hatch, a retail brokerage for buying US shares, and in late January the AFR reported that Kiwi Group Holdings had hired Goldman Sachs to test the market for Kiwi Wealth, after receiving a handful of unsolicited approaches for the company.
Direct government ownership could also complicate Kiwibank's operations, with Labour already trying to ensure banks maintain branches in provincial areas.
In June 2021 the Herald revealed that Robertson, under pressure from provincial mayors and new Labour MPs in provincial seats traditionally held by National, had leaned on New Zealand's retail banks to extend the use of regional banking hubs across the country.
Jurkovich, responding in his capacity as chairman of the New Zealand Bankers' Association, wrote to Robertson to say banking hubs would not be extended while a small trial was under way.
However soon after the NZBA announced a further moratorium on branch closures.