The Financial Markets Authority (FMA) is consulting on six proposed standard conditions in preparation for a new conduct regime that is expected to commence in early 2025.

The proposed standard conditions relate to licences granted under the Financial Markets (Conduct of Institutions) Amendment Act 2022 – CoFI for short – which was passed last month.

CoFI introduces a new regulatory regime for the conduct of registered banks, licensed insurers and licensed non-bank deposit takers, with an overarching principle for these institutions to treat consumers fairly.

The six proposed standard conditions are ongoing requirements; notification of material changes; regulatory returns; outsourcing; business continuity and technology systems; and record keeping.

FMA says the standard conditions are consistent with those imposed on other licences issued by the regulator, such as financial advice provider licences.

“We strongly encourage industry and stakeholder feedback on our consultations to ensure our regulatory proposals are fair and appropriate,” FMA FMA Director of Banking and Insurance Clare Bolingford said.

“The standard conditions for financial institutions are especially important given these businesses play such an important role in New Zealanders’ everyday lives.”

The FMA expects to start accepting licence applications in mid-2023, about 18 months prior to the new legislation coming into force.

Closing date for submissions is September 7.

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