Dairy indebtedness and Auckland's overheated housing market remain risks to banks' financial strength, says The Reserve Bank (RBNZ).
However, the RBNZ's six-monthly financial stability report said New Zealand's financial system is "sound and continues to operate efficiently".
Governor Graeme Wheeler said global economic growth had been subdued, despite easy money policies in many countries, while political uncertainty had increased financial market volatility.
The outlook for one of the RBNZ's continuing worries, the dairy sector, had improved because of the strong rise in prices over the past three months. It put the level of dairy sector debt at about $40.1 billion, about 10 percent of total bank lending.
"However, indebtedness in the sector has increased as farms have had to borrow to absorb losses over the past two seasons, leaving the sector vulnerable to future shocks. Some farms remain under pressure and problem loans are likely to continue to increase for a time," Mr Wheeler said.
He reiterated the now-standard concern about Auckland's house market, but acknowledged house price inflation there had eased under the effect of the more stringent loan to value restrictions. But even so house price growth of 9.3 percent was among the fastest in the world.
Growth in house prices elsewhere around the country was also more evident, and credit to the household sector, with the ratio of household debt-to-disposable income rising to a record high of 165 per cent.
"There is a significant risk of further upward pressure on house prices so long as the imbalance between housing demand and supply remains."
The bank said it has asked the government to approve the use of debt-to-income ratios, if necessary, to cope with further house price pressures.
Such ratios would assess a borrower's income against the amount to be borrowed, and if it was above a certain level banks would be limited in how much they could lend to such customers.
In October 2014, the average loan for a first home was just over $270,000 - last month it hit $390,000.
The government has warned homeowners to be cautious, with Housing Minister Nick Smith saying, low interest rates had fuelled the housing market, but that they were likely to start rising.
"We have said that people do need to be cautious, that there is the prospect of interest rates going up, people need to be careful that they don't get themselves into levels of debt that they would be in difficultly if it went down that scenario."
The RBNZ also singled out the risk to households and banks from the higher cost of borrowing that has been occurring in recent months.
Low interest rates have seen investors pull money out of banks to put into higher yielding investments such as shares or property.
This has meant local banks having to borrow more overseas, but at higher interest rates, which is now feeding through into longer term loans.
"Banks could become more susceptible to increased funding costs and reduced access to funding in the event of heightened financial market volatility," said the deputy governor Grant Spencer.
Deputy governor Grant Spencer said the insurance industry also looked well placed to cope with claims from the recent magnitude 7.8 Kaikōura earthquake. He said early estimates put the insurance cost at between $1b and $5b.
Analysts said the report did not throw up any new issues.
"Overall, the report indicates the financial system is sound, and policy measures to date are having the desired effect," said Westpac senior economist Anne Boniface.
"However, we are left in no doubt that the RBNZ is very keen to add DTI (debt to income) restrictions in some form to its macro prudential armoury, providing it with additional options should financial stability risks heat up again further down the track."
The report was not seen altering the RBNZ's monetary policy outlook, which is for the official cash rate to be left at 1.75 pct for the foreseeable future.