Did you know the Reserve Bank this week revealed its plans to manage the failure of one of the big four banks?
The release of any other disaster plan for a major part of New Zealand's economy would be big news, but not for banking. No one wants to highlight the risks involved in our big four banks, which make up the most concentrated banking system in the developed world with liabilities worth 180 per cent of gross domestic product.
Also, the Government doesn't want too much of a debate about how it would deal with a bank failure. The last time our Government guaranteed the big four banks, there was no debate.
The deposit guarantee scheme imposed over that mad weekend in October 2008 left a dangerous legacy. New Zealanders now believe that if one of the big banks fails, the Government will step in.
The Reserve Bank this week has done its best to indicate that we shouldn't expect that. The regulator has been working hard to come up with a way to allow a bank to fail and be reconstructed without a government bailout.