The Reserve Bank has determined that ANZ New Zealand is in material breach of outsourcing requirements that apply to systemically important banks.
ANZ NZ notified the regulator of the breach on 6 November last year. The Reserve Bank subsequently ruled the bank had materially breached condition 11 of its registration conditions, with the breach period running from June 2022 to the present.
Nature of the breach
Between April 2024 and September 2025, ANZ NZ reported multiple instances where it failed to maintain effective alternate arrangements and robust back-up capability for outsourced functions. While the Reserve Bank initially assessed each incident as non-material in isolation, the regulator concluded that taken together they represent a material breach due to systemic shortcomings in ANZ's outsourcing oversight, processes and controls.
The two principal issues identified were certain back-up arrangements that would not function as designed if ANZ NZ needed to separate from ANZ Australia, and broader gaps in oversight and control frameworks.
Both the Reserve Bank and ANZ NZ stated the issues had no customer or financial impact. An ANZ NZ spokesperson said the bank disputes that it has not been materially compliant with the revised outsourcing policy overall.
Remediation underway
ANZ has rectified the specific back-up arrangement issue and is conducting a broader remediation programme to strengthen its processes and controls. The bank disclosed the non-compliance in its latest general disclosure statement, committing to keep the Reserve Bank updated on progress.
The material breach listing for ANZ NZ remains open and is currently the only material bank breach with that status on the Reserve Bank's public register.
Context: outsourcing requirements
The Reserve Bank's outsourcing policy requires systemically important banks to retain both legal and practical control over business functions they outsource, including IT processing, accounting and call centres. The policy is designed to limit economic damage from the failure of a large bank or major service provider, and to maintain viable resolution options if a major bank collapses.
In December 2023, the Reserve Bank confirmed all major New Zealand banks had met revised outsourcing requirements by an October 2023 deadline. That milestone meant the four Australian-owned banks operating in New Zealand could function independently of their Australian parents if circumstances required.
ANZ NZ previously disclosed that its outsourcing compliance programme spanned five years and cost more than $580 million. In May 2022, ANZ NZ CEO Antonia Watson said she would have "love to have spent that money on customer propositions".