A banking expert says new banking protection schemes such as the deposit guarantee scheme could put close to a percent on mortgage rates.
The government will introduce a bank deposit guarantee scheme and will look at a tougher regime to make bank executives more accountable for bad behaviour.
The guarantee scheme would have a limit of between $30,000 and $50,000, which would cover 90 percent of individual bank deposits in New Zealand.
This is part of the review of the Reserve Bank Act, which is looking at the 30-year-old laws regulating the banking system.
Corin Dann speaks to John Kensington, the head of banking at KPMG, about what banks might do to recoup the costs of the new guarantees and capital requirements.
