The Reserve Bank of New Zealand has introduced a new regulatory requirement called BS11. It outlines the outsourcing policy for large banks in New Zealand whose net liability exceeds NZD 10 billion. BS11 is set to come into full effect from 1 October 2022.
SmartStream creates a business line to support the New Zealand banks via our cloud offerings by providing the technical infrastructure and hosting. For collateral management, the client must be able to operate the Collateral system independent of the whole group. The New Zealand operations need to be able to load, review and process information pertaining only to the New Zealand operations in the case of a separation event. Under the BS11 requirement, the New Zealand arm of the parent bank must be named in the contracts to have rights to utilise the softtware should a separation event be called by the RBNZ. This applies to reconciliations and cash and liquidity management.