Friday 12th December 2008 |
Text too small? |
The move applies to securities denominated in New Zealand dollars and is expected to be a temporary measure while financial markets are unsettled.
"We are taking these steps to further enhance system liquidity and ease some of the current pressures on corporate sector funding," Deputy Governor Grant Spencer said in a statement.
Each security would be considered on a case-by-case basis, Spencer said. The liquidity measures don't mean the central bank will be lending direct to companies though they are likely to make corporate debt more liquid and therefore a more attractive investment prospect for banks and portfolio managers, he said.
The securities will include those guaranteed by the government, corporate securities rates at least BBB-, shorter-term securities rated A2, F2, P2 or better, and New Zealand dollar asset-backed securities rated AAA, A1+, F1+ or P1, according to the statement.
In October, the bank said it would temporarily accept residential mortgage-backed securities as collateral to improve liquidity in the banking system. The move mirrors action by the Australia's central bank, which yesterday relaxed restrictions on the use of securities for repurchase agreements, including RMBS.
No comments yet
SML - Synlait Milk Limited - Trading Halt of Securities
AIA - Auckland Airport announces board chair changes
AIA - Auckland Airport announces board chair changes
CEN - Tauhara commissioning progress update
FPH initiates voluntary limited recall
March 28th Morning Report
KFL Celebrates 20 Years of Excellence in Investment Mgmt.
SVR - Savor FY24 Earnings Guidance & Change in Banking Partner
NZK - NZ King Salmon Investments Limited FY24 Results
March 27th Morning Report