If re-elected, National will revisit the idea of opening the state-owned Kiwibank to local private capital so it can compete better with the big Australian banks.
By Corin Dann of RNZ
The party's finance spokesperson, Nicola Willis, described the idea as a "win-win solution" and said her party would have more to say about the issue during the campaign.
"I think that that is actually a great path for Kiwibank, because that way it's benefiting not only its banking customers, which increasingly are Kiwi businesses, but it's also allowing New Zealand investors to get the upside of its growth."
Last year the government gave the go-ahead for Kiwibank to engage with local investors, including KiwiSaver providers and Māori institutions, to see whether they were interested in investing in the state-owned bank.
At the time the government said that raising an additional $500 million of capital could support up to $4 billion of business lending or $10b of home lending.
However, Kiwibank's parent, Kiwi Group Capital, scrapped the plan a few months later, saying while it had engaged with investors, changes to Reserve Bank capital requirements had given it access to another $400m in capital.
Nicola Willis acknowledged Kiwibank was greatly assisted by the Reserve Bank changes.
However, she said, looking to the future, Kiwibank would need more capital to grow.
"We are very keen to work with them to make sure they can get it. I want Kiwibank to continue its rate of growth, which has been faster than the Australian banks, and to be at a scale that it can take on the big guys."
New Zealand's banking sector is dominated by the big four Australian-owned banks, which collectively are thought to have around 85% of the lending market, with Kiwibank's share just over 6%.
Willis said when Kiwi Group Capital engaged with local institutions about investing money in Kiwibank last year, some had concerns about how they would get a fair price if they wanted to exit their investment.
"So those are the issues that need to be worked through. But there's no question there's capital here in New Zealand right now which would like to have a stake in Kiwibank."
Any move by Kiwi Group Capital to take in outside investment would dilute the government's ownership of Kiwibank.
Labour described the idea when it first emerged as a form of partial privatisation and was opposed to the idea.
New Zealand First leader Winston Peters has also said he would not entertain a partial sale, with his party also proposing the buyback of the BNZ.
Nicola Willis, however, said there would be safeguards to make sure it stayed in New Zealand ownership.
"It would require the New Zealand government to have specified things in the Kiwibank constitution that guarantee that it remains a Kiwi bank. And these are not unusual arrangements. Of course, we have a Kiwi share in Air New Zealand and other entities that requires particular things of that entity, to keep its New Zealand ownership and character clear."
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