The Reserve Bank has just released its 2007 Annual Report which notes that New Zealand’s financial systems and banks are generally in good nick. However it also takes time to highlight similar risks to the New Zealand economy that Finsec has been discussing in recent years: the possible negative impact on the economy of banks continuing to focus on raising household debt rather than improving savings and customer service, and the negative impact that foreign owned banks are having on our current account deficit by not reinvesting enough back into New Zealand’s local communities.
“New Zealand’s current account deficit continues to grow, fanned by domestic savings-investment imbalances and high levels of household debt. Much of the debt has been funnelled into the housing market, putting upward pressure on house prices. Part of the growth in mortgage debt has involved some banks offering new mortgages that require little or no borrower deposit (high loan-to-value loans). Some households’ ability to service this debt has continued to deteriorate.” (p27)
“Record levels of household debt, combined with stretched house prices, leaves the New Zealand economy and its banking system relatively more exposed to negative economic shocks. Slower economic growth would put more strain on household debt servicing obligations… Large and persistent saving and investment imbalances raise the possibility of a disorderly correction in foreign exchange and capital markets.” (p30)
(thanks to Collinson for the photo)
...the gossip 
About bloody time we sent these overseas greedy bastards back
to where they belong..their whole drive is to increase our
debt and their profit which then pisses of overseas with no benefit
to New Zealanders.
Everybody should shop locally, to benefit their community. And that goes for banks as well. A local bank will give back to the town they do business in. Not so with the big banks.