New Zealand’s Financial Markets Authority (FMA) has outlined its key priorities and intended work program for the current financial year in its annual corporate plan released last week.

One area of focus relates to the Financial Markets (Conduct of Institutions) Amendment Bill (CoFI), which passed in June, expanding the FMA’s remit to license banks, insurers, and non-bank deposit takers in relation to their general conduct.

“We will continue to work with these financial institutions to ensure they are prepared for the new regime, with licence applications expected to open in mid-2023,” the 2022/23 corporate plan says.

“Current and forecasted economic settings, including inflationary pressures, rising interest rates, and declining business and consumer confidence, could adversely affect the profitability of banks and insurers.

“There will also be important considerations for fair treatment of consumers, particularly those in vulnerable circumstances, as debt servicing and general costs of living increase.”

The regulator is also going to continue with its work on developing climate disclosure standards following the passage last year of the Financial Sector (Climate-related Disclosures and Other Matters) Amendment Bill.

The legislation will require around 200 large financial institutions including insurers covered by the Financial Markets Conduct Act 2013 (FMC Act) to start making climate-related disclosures.

FMA says it will be developing standards and consultation through next year and the first climate-related statements are due in 2024.

“As our remit grows, the FMA will have a greater focus on fair outcomes for consumers and investors,” CEO Samantha Barrass said.

“The financial sector is an enabler in people’s lives and it’s important it works well for all.

“In turn, this will shape how the FMA operates and organises itself as we step up and deepen our understanding of consumers and how they interact with financial markets and services.”

Click here for the corporate plan.