latest bankster scheme: Open Bank Resolution (OBR)


Richard Moore

This is a 12-page document. Only the first two pages are copied here. Download to get the whole thing. The document describes a scheme to confiscate your savings and retirement funds as a solution to bank insolvency.
Consultation Document: Pre-positioning for Open Bank Resolution (OBR)
Consultation Paper
The Reserve Bank invites submissions on this Consultation Paper by 30 June 2011. Submissions and general enquiries about the consultation should be addressed to:
Kevin Hoskin Adviser, Financial System Policy Prudential Supervision Department Reserve Bank of New Zealand PO Box 2498 Wellington 6140 Email: •••@••.••• Tel: +64 4471 3764

For technical enquiries about the consultation, please contact:
Steve Anderson Email: •••@••.••• Tel: +64 4471 3734
March 2011
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Consultation Document: Pre-positioning for Open Bank Resolution (OBR)
1.1 Background
1 The Reserve Bank is consulting registered banks on pre-positioning banks’ systems to ensure compatibility with the Open Bank Resolution (OBR) policy. This represents an important step in a government wide process to fully operationalise the OBR policy, as noted in the statement from the Minister of Finance on 11 March 2011.
2 An open bank resolution is an option whereby the bank is open for (full-scale or limited) business on the next business day after its temporary closure following an insolvency event or an event that triggered putting it under statutory management, and is able to provide customers with full or partial access to their accounts and other bank services.1
3 Recent international developments in the field of bank resolution have focussed on enhancing authorities’ capacity to respond and resolve large or systemic failures without straining fiscal resources. One of the key lessons emerging from that crisis is the potentially enormous fiscal costs associated with supporting troubled banks. Some governments that chose to guarantee their banking system’s liabilities are now faced with a sizeable public debt burden. The alternative is to make bank shareholders and creditors shoulder the losses of a failing bank whilst ensuring that the payments system continues to function. Developing alternative solutions for dealing with failing banks has thus become a key priority for many governments and the global regulatory community.
4 OBR is intended to act as a resolution tool that puts the cost of bank failure primarily on the bank’s shareholders and creditors rather than the taxpayers, minimises moral hazard and provides continuity of core banking services. The Reserve Bank developed the OBR policy following a review of its crisis management policies and instruments subsequent to the 1997 Asian financial crisis.2
5 Significant work has been undertaken in recent years to ensure that the structures of financial institutions in New Zealand and the payments system are consistent with the implementation of OBR as a live policy option. Major Reserve Bank policies such as3
See W. Chetwin, ‘The Reserve Bank’s Local Incorporation Policy’, 69(4) Reserve Bank of New Zealand Bulletin (2006), and RBNZ ‘Outsourcing Policy’, January 2006
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outsourcing, local incorporation and governance3 were designed to facilitate the implementation of OBR. The pre-positioning of banks’ internal systems represents the next stage in that implementation process.
6 Whilst the Reserve Bank has led the development of the technical aspects of the policy, the OBR itself is a wider government initiative. To this end, the Treasury is separately engaged in work to consider the appropriate form for government guarantees that will be required to support the on-going operations or any institution that is subject to the OBR process.

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