Winston Peters’ threat to nationalise a major Australian-owned bank would send a “bad signal” to potential foreign investors, a veteran economic analyst says.

Peters’ party NZ First said if re-elected in November it would merge BNZ and Kiwibank under state ownership. BNZ was sold by the state in 1992 and is owned by National Australia Bank (NAB), which has not indicated it is looking to sell the profitable subsidiary.

Peters on Monday morning said the price would likely be “$7.5 billion upwards”, and if its owner was not keen to sell, “they always face the prospect of nationalisation”.

“I blanched at that point,” Michael Reddell told Midday Report. Reddell has more than 30 years’ experience in economic analysis, including stints at the Reserve Bank, Treasury and the International Monetary Fund.

“I mean, as a country, we’re supposedly keen on encouraging foreign investment – perhaps New Zealand First not so much – but generally across the parties, across the economic advisers, we’ve said over the years that we’ve actually made it too hard for foreigners to invest here.

“If you go down a nationalisation route, even if you pay a fair price, it seems a pretty bad signal.”

Peters claimed Australia was in a recession, making this a good time for New Zealand to make an offer.

“Contrary to what the minister said, I mean, Australia is not in a recession at the moment,” Reddell said. “There’s no reason to suppose that NAB would be particularly interested in selling unless we paid an over-the-top price. And if we pay an over-the-top price, what’s in it for the taxpayer?”

Peters’ intention was for the new entity, which he dubbed the National Bank of New Zealand, to be commercially run and designed to compete more aggressively with the major Australian-owned banks operating in New Zealand.

Reddell noted that merging two of the five biggest banks in the country would mean fewer banks competing with each other.

“The argument, I suppose, would be that the motivation of a government entity was different than a private entity. But the way we set up [state-owned enterprises] in this country over multiple decades has been that we expect them to operate on a commercial basis. So you’d hope that this new bank would operate commercially successfully.

“The risk is that it wouldn’t, and the political imperatives would drive it. And what’s happened with too many government banks over the years is without the market discipline of being listed on the share market, they take bad credit risks and they end up coming a cropper and costing the taxpayer a lot when that bad stuff happens.”

Instead, Reddell said it should be easier for foreign firms to set up new banks in New Zealand.

“Those are the sort of people that we should be looking to get into the market – private entities taking risk for their shareholders, not getting the government back in the business of banking in some throwback to the 1970s.”

Prime Minister Christopher Luxon, whose party National is in coalition with NZ First at present, dismissed the idea and said it would cost far more than Peters thinks.

“That would be $30 billion of more borrowing that we don’t have. And, you know, that sounds like a Labour or a Greens policy, frankly… that just doesn’t make sense, you know, to borrow more money to buy a private company for the government to own.”

Peters predicted any potential coalition partners after the votes were counted would “cave in” and go ahead with the plan.

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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand

Kiwi forward Briton Nikora will make his State of Origin debut next week after being named in the Queensland team.

Nikora is the first Kiwi international to be allowed to play in rugby league’s biggest showpiece after a change in eligibility rules.

The Australian Rugby League Commission (ARLC) announced the amendment in February.

Players were previously required to represent Australia or a tier two nation as defined by International Rugby League to be eligible for Origin.

This ruled out players who had represented the Kiwis or England.

The updated rules remove this restriction, allowing players who who meet the traditional State of Origin criteria and represent tier one nations to be eligible.

That criteria includes being been born in New South Wales or Queensland, residing in either state prior to their 13th birthday, or if a players father played State of Origin.

Nikora has played 15 tests for new Zealand, though qualifies for Queensland having moved to Brisbane at the age of nine.

He has played his senior career exclusively for the Cronulla Sharks, playing 168 NRL games since 2019.

Two Warriors will also play in Origin I- Co-captain Mitch Barnett for New South Wales and second rower Kurt Capewell for Queensland.

Team lists

NSW Blues squad

1. James Tedesco (Sydney Roosters)

2. Brian To’o (Penrith Panthers)

3. Stephen Crichton (Canterbury-Bankstown Bulldogs)

4. Kotoni Staggs (Brisbane Broncos)

5. Tolutau Koula* (Manly Warringah Sea Eagles)

6. Mitchell Moses (Parramatta Eels)

7. Nathan Cleary (Penrith Panthers)

8. Addin Fonua-Blake* (Cronulla-Sutherland Sharks)

9. Reece Robson (Sydney Roosters)

10. Mitchell Barnett (Warriors)

11. Hudson Young (Canberra Raiders)

12 Haumole Olakau’atu (Manly Warringah Sea Eagles)

13. Isaah Yeo (c) (Penrith Panthers)

14. Cameron Murray (South Sydney Rabbitohs)

15. Victor Radley* (Sydney Roosters)

16. Jacob Saifiti (Newcastle Knights)

17. Blayke Brailey* (Cronulla-Sutherland Sharks)

18. Ethan Strange* (Canberra Raiders)

19. Casey McLean* (Penrith Panthers)

20. Dylan Lucas* (Newcastle Knights)

Coach: Laurie Daley

* Yet to play for NSW

QLD Maroons squad

1.Kalyn Ponga (Newcastle Knights)

2. Selwyn Cobbo (Dolphins)

3. Robert Toia (Sydney Roosters)

4. Hamiso Tabuai-Fidow (Dolphins)

5. Jojo Fifita (Gold Coast Titans)

6. Cameron Munster (Melbourne Storm)

7. Sam Walker (Sydney Roosters)^

8. Thomas Flegler (Dolphins)

9. Harry Grant (Melbourne Storm)

10. Tino Fa’asuamaleaui (Gold Coast Titans)

11. Reuben Cotter (North Queensland Cowboys)

12. Kurt Capewell (Warriors)

13. Max Plath (Dolphins)^

14. Briton Nikora (Cronulla Sutherland Sharks)^

15. Lindsay Collins (Sydney Roosters)

16. Patrick Carrigan (Brisbane Broncos)

17. Trent Loiero (Melbourne Storm)

18. Ezra Mam (Brisbane Broncos)^

19. Gehamat Shibasaki (Brisbane Broncos)

20. Kulikefu Finefeuiaki (Dolphins)

^ Potential debutant

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New Zealand First might want the government to buy back BNZ and meld it with Kiwibank to create a banking competitor to take on the Australian big banks – but there’s limited evidence that it would work.

NZ First leader Winston Peters said at the weekend that the decision to sell the bank in the 1990s was a disgrace.

The bank encountered problems in the 1980s when it expanded into corporate lending after market deregulation.

The Crown coughed up not once ($634 million) but twice ($720m, with the help of another investor) to save it, before it was eventually sold to National Australia Bank, which still owns it.

Speaking at a campaign event at the Trusts Arena in West Auckland, Peters said the new entity – to be known as “National Bank of New Zealand” – would be commercially run and designed to compete more aggressively with the major Australian-owned banks operating in New Zealand.

He estimated buying the bank would cost “$7.5 billion upwards”.

Government-owned Kiwibank has struggled to have an impact in the sector and has been described as a “one-armed boxer” hampered by a lack of capital.

University of Auckland emeritus professor Tim Hazledine said improving banking competition was a worthwhile goal but reducing the number of major brands was unlikely to achieve it.

“Rather than buying back the Bank of New Zealand and merging it with Kiwibank, the government should use its ownership of Kiwibank to position it as a ‘fighting brand’ and reduce interest rate margins,” he said.

“That could put pressure on the big four Australian-owned banks to follow suit.”

Sam Stubbs, founder of Simplicity, said purchasing BNZ would require a willing seller.

“There isn’t one there. That means the price is likely to be high which will limit the ability of the bank to offer cheaper mortgages and higher term deposits. Even if it did work and demand grew, the government of the day would need to spend more taxpayer money to expand, we need that money spent on hospitals.”

He said he could understand a desire to go back to the “good old days” of state-owned banks.

“But I suspect a better and much cheaper for the taxpayer way to achieve the same thing is for Kiwibank to be renamed the National Bank of NZ and listed with only NZ shareholders and let KiwiSaver funds provide the billions required to make it a serious, publicly owned bank.

“Public ownership does not have to mean government ownership. If only New Zealand investors can own shares a listed Kiwibank would be publicly owned, we would be selling the family silver to the family.”

Other sectors in which the government has a strong ownership stake include power – where it owns 51 percent of three of the country’s four major electricity gentailers – and airlines, where it owns 51 percent of Air New Zealand, have their own challenges.

The government bought back KiwiRail in July 2008.

University of Auckland senior finance lecturer Gertjan Verdickt said there was “ample” evidence that NZ First’s plan was not a good idea.

“I have an entire paper on the railway industry in the 1930s: we show that governments are more likely to give money to politically connected railways, not those in economic need.

“Interestingly enough, it doesn’t change profitability, you see employment growth down, but wages of current employees go up. In other words, it doesn’t help the railway, it helps employees, especially the c suite. Also, the chances of those railways going bankrupt actually goes up. So, all in all, bad idea.”

He said there had also been an international study looking at how government ownership and involvement in a banking system affected performance between 1989 and 2004.

“They uncover an interesting pattern of changing performance differences between state-owned and privately-owned banks around the Asian financial crisis. They find that state-owned banks operated less profitably, held less core capital, and had greater credit risk than privately-owned banks prior to 2001. Again – troubles in paradise.”

He said there was some evidence that consumers would benefit if a Government bought a bank. After a bailout, there were lower loan spreads, longer maturities for loans and less collateral held.

“Overall lending goes up but if you see which type of lending, it is politically driven. This to me doesn’t outweigh the risks.”

Kōura founder Rupert Carlyon said in the energy market, the companies had underinvested in generation to keep prices high.

“It is also telling that the government couldn’t put money into KiwiBank and then the private sector were unwilling to, due to its low profitability.

“Let’s figure out where the problems lie and then we can go from there. In my mind, really good regulation is needed and solves the problems.”

He said it would help to have good regulation requiring banks to minimise costs for customers, such as with an annual review of customers’ accounts to ensure they were set up efficiently, and an annual fee letter setting out what fees, interest payments and other relevant sources of revenue applied so customers could compare what they were paying to what they would be charged at other banks.

“Around small business lending and risk appetite, I am not sure there is a huge amount that can be done here – this is the one place where increased competition would be very helpful but we need to let banks set their own risk appetite. SME banking is the issue here. But the government owning BNZ and telling them to relax their credit criteria is not the answer either. Maybe the answer is that we need to instruct KiwiBank to focus primarily on SME banking and give up on corporate and retail banking.”

Kernel founder Dean Anderson also said there was no evidence.

“I think the commentary on government intervention and forced acquisitions raises serious concerns for investors and global relations. Maybe too much time in the Trump sphere.”

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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand

Last year’s weak economic conditions coincided with a 35 percent drop in the value of capital investments, along with a 10 percent drop in the number of transactions the year earlier.

NZ Private Capital Monitor indicates there were 276 transactions last year, with $2.5 billion in combined investments and divestments across private equity and venture capital transactions, compared with $3.77b in 2024.

The decrease was driven by a drop in the size and number of large private equity activity deals, with three deals totalling $541m in 2025, compared with three deals totalling $1.66b in 2024.

Total weighted investment activity accounted for about 71 percent of 2025’s total transactions to $1.78b, which represented a 35 percent on 2024’s $2.77 total invested. Divestments fell 27 percent to $723.6m.

Despite the drop, there was an increase in the size and number of mid-market investment activity, as well as a record level of venture capital investment.

“If you look at the trend, particularly you look at the venture capital trend that’s been on a steady progressive increase over the last decade, that’s a very positive trend in the mid market, that market has been steady and continues to grow as well,” NZ Private Capital executive director Colin McKinnon said.

“So the trend is positive, we’re doing good work, we’re growing good companies, and they’re internationally relevant companies that we’re growing, it’s a lot to be positive about.”

The total number of mid-market transactions rose 85 percent to 50, with a total value of $549m, compared with $519m in 2024.

There was a record level of venture and early stage investment activity totalling $687m, which was 17 percent up on 2024’s $587.6m. Most of the investment was focused on IT/software and technology companies.

The findings were based on the transactions of NZ Private Capital Market participants, which included international and domestic fund managers, law, accounting and banking professionals, institutional investors, business angels and government agencies.

“The outlook for the next six months remains neutral as a result of current global macroeconomic factors, with levels of optimism increasing in future years,” McKinnon said.

“Recent global geopolitical events were not reflected in survey responses. However, this activity will undoubtedly have an ongoing impact on financial market risk in the near to medium term, the extent to which is yet to be seen.”

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The Government is stepping up support to help small businesses adopt artificial intelligence, with the expansion of the AI Advisory Pilot announced today at the Great New Zealand AI Roadshow in Auckland.

“Expanding practical, on-the-ground support is key to helping businesses turn AI into real productivity gains,” says Minister for Small Business and Manufacturing Cameron Brewer. 

“AI has the potential to lift productivity and drive economic growth, with estimates suggesting generative AI alone could contribute up to $76 billion to New Zealand’s economy by 2038.”

“Announced in January this year, the AI Advisory Pilot is delivered through the Regional Business Partner Network (RBPN) and has had strong demand from small business. We are therefore increasing the reach of the pilot by 200%, from 50 business up to 150 business. We are also widening the eligibility so more firms can take part.”

“Eligible businesses can access co-funding of up to 50 percent, capped at $15,000, for expert support to develop and implement AI plans tailored to their business needs.” Mr Brewer says.

Mr Brewer also celebrates the launch by Business Mentors New Zealand of two AI tools that help support business mentors. Both tools were developed with funding delivered by this Government.

“These tools will both provide business intel to mentors, and free them up to do what they do best – provide valuable mentoring support to businesses.”

Today’s announcements were made at the first stop of the Great New Zealand AI Roadshow.

“The strong turnout shows businesses are ready to embrace AI. The focus now is ensuring they have the confidence and capability to use it,” Mr Brewer says.

“The message is clear; AI is not just for large corporates. With the right support, businesses of all sizes can, and do, benefit.”

“This Government backs small businesses to adopt AI, lift performance, and stay competitive in a fast-changing global economy.”

Notes to editors:

Two tools are below:

The Mentoring Assist AI tool will improve how one on one mentoring conversations are captured, recorded, and supported.
The Digital Mentor tool will strengthen the support available to Business Mentor New Zealand’s network of more than 1,500 mentors. This will provide them with 24/7 access to anonymised business insights to help mentors prepare for sessions and provide guidance across key business areas, including strategy, finance and marketing.”

The AI Advisory Pilot has also been extended to run until 31 January 2027. For more information, businesses can contact their local Regional Business Partner or visit: Find your local Regional Business Partner – Business.govt.nz
More information on Business Mentors New Zealand’s AI tools can be found at: Business Mentors New Zealand
The Great New Zealand Roadshow will be visiting other centres including, Nelson 27 May, Napier 2 June, New Plymouth 4 June, Tauranga 11 June, Hamilton 16 June, Wellington 18 June, Christchurch 25 June, and a Virtual Event on 1 July. More information and tickets can be found at: The Great NZ AI Roadshow | AI New Zealand

The finance minister is set to reveal proposals to reduce the number of government agencies, by telling ministries and departments to come up with plans for amalgamation.

RNZ understands Nicola Willis will set out three proposals on Tuesday afternoon to create efficiencies in the public service, including amalgamating government agencies, more work on digitisation and using AI, and setting a target to reduce the public service headcount to 1 percent of the total population by 2029.

Willis will reveal further details in a pre-Budget speech to Business North Harbour.

On Monday evening, she told Newstalk ZB’s Heather du Plessis-Allan the government would be taking the approach of asking the public service to come back with options on “logical” mergers.

Asked whether some departments would be cut altogether, Willis said there were two ways of coming at the same problem, pointing to the new Ministry for Cities, Environment, Regions, and Transport, which will replace the Ministry for the Environment, Ministry of Housing and Urban Development, Ministry of Transport, and the local government functions of the Department of Internal Affairs.

“So, in effect, some of those entities don’t exist anymore, but what you’ve got is one joined up agency that delivers all of the decent things those agencies were delivering in a much more coherent way,” Willis said.

“So we want to do more of that approach of saying, ‘well, what actually would make more sense to come together under one umbrella and one agency, and would actually lead to a better service to the customers it’s trying to serve, and would be more efficient?’”

Last year, the Public Service Commissioner Sir Brian Roche told Mata he was looking at a shakeup of agencies.

At the time, he said all options were on the table, but indicated ministries’ functions and branding would remain.

Willis told Newstalk ZB she would release figures on reducing the headcount during her speech, but said she accepted New Zealand would continue to have a growing population, and growing demands for the delivery of public services.

“We’ll continue to incarcerate people in our prisons, deliver welfare support to families, so those things will continue, but absolutely we can do more of that using digital tools, being more efficient. We don’t need as many departments to do it. We’ve got some awesome public servants. They’re smart cookies, but ultimately we tie them in bureaucracy a lot at the moment.”

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