27 Oct 2008

Greens want freeze on dividends to Australian banks

10:59 am on 27 October 2008

The Green Party says Australian-owned banks should be stopped from sending dividends to their parent companies during the global financial crisis.

The call came after the Reserve Bank of New Zealand approved the purchase of residential mortgage-backed securities worth $8.7 billion for the ANZ National and Westpac banks.

The banks were the first to take up an offer by the Reserve Bank to provide extra liquidity during the global financial crisis.

The British government has taken a stake in many banks and in return, stopped the payment of dividends.

Greens co-leader Russel Norman says the Reserve Bank should do the same and make overseas-owned banks keep profits in New Zealand, until the crisis is over.

Neither Finance Minister Michael Cullen nor the Reserve Bank would comment on the Green Party proposal.

Westpac says it has not drawn on the facility yet, but may if market conditions remain difficult.