Workstream Initiative Summary
5.
Firm Funding
NEAR TERM & HIGH PRIORITY
BIG
DETAILED
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Stimulating the development of New Zealand’s debt markets
Equity growth fund for SMEs
Bank and Government transition fund
Statement of commitment from banks to continue to meet the demand for
credit
• Government to be ready to help remove barriers to outside equity raising for
co-operatives if needed
• Review operation of wholesale funding guarantee in light of banks’ actual
experience in offshore wholesale funding markets
• Remove obstacles to raising funding direct from offshore investors, including
retail. Could include modifications to AIL and/or widely-held test
• Government to actively engage with investors, including NZSF, on investment
and funding options and an appropriate investment mandate and parameters
• Survival guide: within a month communicate a proactive plan to provide
better information on bank mechanisms for customer support and assistance
• Building stronger businesses: formal bank–led NZ wide programme for
training managers in SMEs
Workstream Initiative Summary
5.
Firm Funding
LONGER TERM FOR DEVELOPMENT AND CONSIDERATION
• Introduce exemption from non-resident withholding tax and AIL on interest paid on some
widely issued debt instruments
• Promotion of NZ sovereign debt internationally (e.g. recent roadshow)
• Securities Act – employee share scheme
• Securities Act – rights issue
• Securities Act – liability regime
• Takeovers code: alter code for defining how the 50-shareholder threshold is defined so that it
doesn’t capture so many closely-held firms; exempt unlisted companies with less than $10m
in assets from the requirement to provide shareholders with independent advisors report
• Regulatory certainty for Unlisted
• Reduce certification
• Streamline disclosure for closely held companies
• Continuous disclosure improvements
• Investor registration to allow lower disclosure for issues to registered investors who meet
certain criteria
• Review Overseas Investment Act
• Manage future of Government guarantee
Workstream Initiative Summary
5.
Firm Funding
FURTHER INVESTIGATION REQUIRED
• Banks to use their skill base and national networks to assist distressed firms
• SME crisis management – appoint ‘last chance’ mentor to come up with plan for work-through
for bank and firm to agree to
• Expand remit of VIF
• Whole or partial listing of SOEs and LATEs
• Real estate vehicle to purchase and lease back production facilities to NZ manufacturing at
market prices
• IRD require that principal/compound interest not paid by finance companies returned as
income with no reduction for the bad debt unless the investor is a bond dealer
• Tax policy measures to encourage savings, dividend reinvestment
• Ensure prudential regulation reduces risk of procyclicality
• Expand or promote the immigration Investor Category
• Create pre IPO fund for NZX
• Tax on FIF income – fair dividend rate method
• Government provision of loans broker to enable firms to shop around for banking
Workstream Initiative Summary
5.
Firm Funding
FURTHER INVESTIGATION REQUIRED
• Issues around overall level of savings, incl possible bias towards property
• Options for attracting retail offshore deposits (incl addressing tax and AML constraints)
• Financial literacy - pursuit of yield concerns
• Possible need for direct support for property market (commercial or residential)
• Zero tax foreign savers to relocate foreign asset business to New Zealand
• Use existing institutions and ensure Government departments work together to streamline
policies
• Shorten fund assessment times
• Promotion of New Zealand equity markets internationally
• Capital gains tax to encourage productive investments
• Co-ordinated approach to improving financial literacy
• Government to manage aggregate asset and liability portfolios