National's commerce spokesman Andrew Bayly says he has been lobbied by the industry to drop the law. Photo / Mark Mitchell
Accounting firm KPMG is counselling financial institutions that it’s a “risky strategy” to delay compliance with the Conduct of Financial Institutions Act in the hope a National-led government will repeal it.
The COFI Act has become an unexpected target of National’s desire to strip back regulatory costs, with its commerce
spokesman Andrew Bayly saying he had been lobbied from within the financial services industry not to proceed with it.
The repeal pledge, which KPMG calls a “spanner in the works” in its latest quarterly financial institutions performance survey, came out of the blue at a conference last month. It has “created a level of uncertainty into what has been a well-accepted regulatory change”.
The new regime was intended to challenge financial institutions to “provide protections for consumers that don’t currently exist in New Zealand’s regulatory landscape”.
“While many financial institutions we’ve spoken to have said they’re full steam ahead in preparation for the changes, there are others who have pushed the pause button, reduced scope, or delayed aspects of their readiness programmes,” KPMG director of risk consulting, Kate Stewart and risk consulting partner Malcolm Bruce, wrote.
