Banks borrow more cheap RBNZ money while hiking loan rates

RBNZ governor Adrian Orr said the cheap bank funding is a contract. (Image: Getty)

Fri, 20 Aug 2021

New Zealand's banks have borrowed an additional $1.5 billion so far this week from the Reserve Bank at 0.25% under the funding-for-lending programme (FLP).That's even as they have been raising their own lending rates in anticipation that the RBNZ will raise its official cash rate soon, something the central bank confirmed on Wednesday.RBNZ data shows banks borrowed $500 million on Wednesday after borrowing $1b on Tuesday under the FLP scheme.The data doesn't reveal which banks did the borrowing under the scheme which the RBNZ introd...

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