OBR is a Reserve Bank policy aimed at allowing a distressed bank to be kept open for business, while placing the cost of a bank failure primarily on the bank’s shareholders and creditors, rather than the taxpayer.
Stage one of the implementation of the OBR policy has been completed, with that stage culminating in the submission of OBR implementation plans by banks to the Reserve Bank at the end of February 2012. In the second stage of implementation, which was originally scheduled to be completed by the end of this year, all locally incorporated banks with retail deposits of over NZ$1 billion were required to pre-position their internal technology and banking systems to meet the OBR functionality requirements. Further to bank requests for additional time to complete this stage, the Reserve Bank has extended the deadline for the completion of such systems pre-positioning to 30 June 2013. This extension should allow all banks more time to develop and test their OBR system solutions.
The Reserve Bank has also indicated that it is their intention to consult on a draft OBR standard and the related draft OBR Conditions of Registration towards the end of 2012. The Reserve Bank's stated intention is to put OBR Conditions of Registration in place by the end of 2012.