MR No. 2023 – 4
The Financial Markets Authority - Te Mana Tātai Hokohoko (FMA) has today published its annual report for the year to 30 June 2022.
The report details a year that encompassed four main areas of focus for the regulator: monitoring and oversight of financial market participants; preparations for new financial markets legislation; building investor capability; and enforcement activity.
Although curtailed by COVID-19 restrictions, monitoring activity remained a high priority. Taking a risk-based approach, the FMA focused on a variety of sectors and topics, including derivatives issuers, cyber-resilience, general insurers’ conduct and culture, and how fund managers have implemented expectations for them to review the value for money they provide to customers.
The Financial Markets (Conduct of Institutions) Amendment Bill (CoFI) was passed into law in June 2022. This new regime will see the FMA licensing and monitoring banks, insurers and non-bank deposit takers in respect of their conduct towards customers. The FMA’s preparatory work throughout the period included shaping up the licence application process, drafting the standard conditions for licences, and engagement with the sector to help develop future guidance.
The regulator also worked with other agencies on standards for the upcoming climate-related disclosure requirement, and published its implementation approach for the regime. This signalled a focus on supporting climate reporting entities, and initially reserving enforcement action for serious breaches of the new legislation.
In response to the continued strong participation in DIY investing through online platforms, the FMA’s investor capability work centred around encouraging new investors to “take a mo” to research investments and make a plan before jumping in.
Activity to deter misconduct also formed a substantial part of the FMA’s programme of work, during the 12 months to June 2022. This included:
Samantha Barrass, FMA Chief Executive, said: “This is the first annual report released under my tenure, and I would like to thank the FMA Board for their support and direction since I took up the Chief Executive role. We are in a period of significant change for regulators, for the industry, and for consumers, with a number of new regulatory regimes being implemented across financial advice, conduct requirements for insurers, banks and non-bank deposit takers, and early adoption of a climate-related disclosure regime.
“Consumers are looking for greater accessibility, for seamless digital experiences that they reach through their preferred channels. They are looking for support as we enter a difficult economic environment.
“Against this backdrop, it will be important to have a clear focus on the outcomes we are looking to see achieved. In particular, to support more New Zealanders than ever having confidence that the financial sector is working well for them.
“There will need to be greater engagement and understanding between the FMA and the industry, building on what we have today, investing in mutual trust that we share the same goals of delivering fairness and value for all.”
In conjunction with the annual report, the FMA has released its annual ‘Ease of doing business’ report, which surveys key stakeholders to understand the effectiveness of their interactions with the FMA, and the FMA’s overall effectiveness in delivering its mandate.
Key findings include:
Note: The delay in publication of the FMA Annual Report is due to time extensions in the external audit that have been available since COVID.
FMA Media Relations Manager
021 220 6770
FMA Senior Adviser, Media Relations
021 945 323