_{Summarised by Centrist} 

Author and former National Party senior minister Steven Joyce is urging the Commerce Commission to persuade the Reserve Bank to break up the four-bank oligopoly. But, he argues, that may go against Kiwi instincts for pursuing safety in size. 

Joyce, in his latest NZ Herald opinion piece, calls Westpac, ASB, ANZ and Kiwibank “fat and happy” and notes that “there is no likelihood of new arrivals upsetting the cosy oligopoly that exists.” 

He sides with ComCom’s belief that existing regulations “create a competitive moat” around the big four banks. Joyce argues this is evident in several regulatory disadvantages, which translate into higher costs, faced by small banks trying to compete. 

Joyce laments that regulations, which his National government (2008-2017) introduced, while protecting the country from money launderers, had the unintended consequence for consumers of making it difficult to switch banks.

“The net effect of all this is that banks are now just giant utilities, like the power company, or Chorus, regulated to within an inch of their lives,” he argues. 

However, Joyce isn’t buying the old NZ line that bigger is better. He cites companies such as Te Pūkenga, Fonterra and Fletchers as having landed upon near-monopolies, but failing to deliver for consumers.

“Competition is nearly always the best way to regulate markets and ensure that consumers win,” he writes. 

Read more over at The NZ Herald (Paywalled)