Implementation of Basel II in New Zealand

The Reserve Bank of New Zealand announced on Friday 18 March that it will allow both the "Internal Ratings Based" and "Advanced Measurement" Approaches in the implementation of the Basel II capital framework in New Zealand.

The use of these approaches will be available only to banks that meet certain criteria.

Basel II is a new international framework for assessing whether banks are holding sufficient capital for the risks they are taking.

Reserve Bank Deputy Governor Adrian Orr said "The major