Phasing out $6b capital layer unlikely to dent banks’ credit ratings: agencies

Banks’ ample piles of CET1 capital in focus. (Image: Getty)

Wed, 17 Sep 2025

Plans to phase out an almost $6 billion layer of capital from New Zealand banks’ capital stacks are unlikely to dent their issuer’s credit grades, several international ratings agencies say.Instead, they are looking beyond the proposed changes to Additional Tier 1 (AT1) instruments to focus on the banks' substantial holdings of Common Equity Tier 1 (CET1) capital.The Reserve Bank of NZ (RBNZ) is consulting on a raft of tweaks to banks’ capital settings, including the potential phasing out of Additional Tier 1 (AT1) instrum...

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