FMA releases CoFI regulatory returns requirements

The Financial Markets Authority – Te Mana Tātai Hokohoko (FMA) has released the question set for annual regulatory returns for licence holders under the Conduct of Financial Institutions (CoFI) regime.

Under the CoFI regime, financial institutions (registered banks, licensed insurers and licensed non-bank deposit takers) which hold a “financial institution licence” will be required to complete annual regulatory returns for the 12-month period starting 1 July 2025. Annual regulatory returns are required by the Standard Conditions imposed on financial institution licences.

This follows consultation on regulatory returns requirements last year.

 

Summary of the changes

Following consultation, the FMA considered the following three options:

• Option 1: no regulatory returns.
• Option 2: broad scope regulatory returns.
• Option 3: narrow scope regulatory returns.

Ultimately, the FMA chose option 3. The regulatory returns process will have a narrower scope than initially proposed, reporting periods of 12 months (rather than nine), and a reduced question set from 48 to 23 questions.

In the opinion of the FMA, a narrower scope regime will allow the FMA to still meet its objectives whilst ensuring that the compliance cost burden on financial institutions is not too heavy.

The first period that regulatory returns must be completed for is 1 July 2025 to 30 June 2026. Regulatory returns for this period will be due by 30 September 2026.

You can find a copy of the FMA’s Regulatory Impact Statement here and a copy of the regulatory returns question set here.

 

Our view of the changes

We support the narrower scope on the basis that this reduces compliance burdens for financial institutions.

Please get in touch if you would like to discuss the FMA’s changes to the regulatory returns process or the regulatory regime for financial institutions more generally.