ANZ, ASB, BNZ and Westpac can ‘afford to ignore’ Kiwibank, MPs told
Wednesday, 13 May 2026
MPs were told on Wednesday that the big Australian-owned banks could afford to ignore Kiwibank because it didn’t have a large enough market share to trouble them.
Kiwibank was founded in 2001 to bring competition to the big four Australian-owned banks; ANZ, ASB, BNZ and Westpac.
However, the Government has grown frustrated that Kiwibank has not yet achieved the scale to transform competition in the banking sector, which earlier this week the Commerce Commission said remained weak.
David McLean, chairperson of Kiwi Group Capital which owns Kiwibank, told a hearing of the Finance and Expenditure Select Committee: “When it's 7.5%, or something market share, the big banks can afford to sort of ignore it. If it was 15%, it would be very hard to ignore. We'd have much more effect in the market.”
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McLean told MPs that Kiwibank’s technology overhaul would soon give the bank leading capabilities, and it had sufficient capital to grow for the next two to three years and do somewhere in the region of $20 billion new mortgage lending.
“The technology transformation project, which is replacing the core IT, will give it a capability that is a generation ahead of the big banks,” McLean said.
That would see it launch open banking on May 29, which should see services like faster mortgage applications and cheaper international transfers become available.
The Government is keen to see Kiwibank grow and challenge the dominant Australian banks.
On May 8, Treasury released documents showing Simeon Brown, Minister for State Owned Enterprises, had written to Kiwi Group Holdings saying the Government expected it to undertake work on “alternative growth scenarios”, and how it would raise money to achieve them.
He was writing after Kiwibank decided not to raise $500 million through a private placement of shares as changes to Reserve Bank capital requirements meant it no longer needed the money to grow in the near term.
Brown’s letter also made clear that the Government did not expect to provide taxpayer money to Kiwibank to grow, and that a sale of Kiwibank through an “initial public offering” on the NZX sharemarket remained on the cards, but only if a mandate to sell it was achieved at the ballot box.
Kiwi Group Capital is owned 50% for the Government by the Minister of Finance, and 50% by the Minister for State Owned Enterprises.
Given that McLean signalled Kiwibank would bump up against its current capital headroom during the term of the next government, in two to three years’ time, that could make selling off Kiwibank an issue National seeks a mandate for in November’s election.
Kiwibank chief executive Steve Jurkovich told MPs: “Our own capability and scale is called out by the Commerce Commission report this last couple of days. We just need to keep growing. We need to be bigger and more influential.”
On Wednesday, Labour leader Chris Hipkins refused to reveal the party’s policy plans for Kiwibank.
He said Labour remained committed to keeping Kiwibank in public ownership, though he would not say whether a Labour-led government would pump in capital from the taxpayer.
On Tuesday, ACT leader David Seymour said Kiwibank had barely taken any market share, and he did not think it was a good use of taxpayer money to own it.
As well as telling MPs about how hard the fuel shock caused by the US war on Iran was hitting households and businesses, Jurkovich followed Westpac’s Catherine McGrath to call on MPs to summon the large US social media platforms to explain why they weren’t doing more.
Criminal groups had in recent months had created deep fakes of Jurkovich and McGrath to con members of the public on social media platforms, which Jurkovich said had been an “unsettling” experience.
“It's far too hard to get that stuff taken down by companies like Meta,” Jurkovich said.
“At some stage the committee might find its chance to invite the Metas of the world to come in, and talk about what extra activity they could undertake to protect us,” he said.
Since being embarrassed by rising fraud losses for customers, the banks have invested in fraud defences, and are claiming to have cut losses for customers significantly.