KEY POINTS:
New Zealand's four major banks successfully raised funding throughout the period of market turmoil as the global credit crunch unfolded, Moody's Investors Service says.
The banks, with their Australian parents, were isolated from many of the sub-prime-related issues affecting other parts of the world. They had continued to tap funding under their own names and should also be able to rely on support from their parents, if needed.
But in a new report, Moody's pointed out that while the use of three- to five-year fixed mortgages had provided a short-term cushion against rising interest rates in this country, they introduced "substantial" roll-over risk when converting to floating rates.
So far New Zealand households had demonstrated an ability to manage roll-overs, it said, despite rising indebtedness.
