The Reserve Bank of New Zealand (RBNZ) said on Tuesday it would establish a new financial policy committee, which would have the authority to set prudential requirements for banks and assist in making decisions on mortgage lending ratios. The move aligns with recommendations from a recent parliamentary inquiry into banking competition and is intended to strengthen the central bank’s financial policy-making, the RBNZ said in a statement. The committee will comprise the RBNZ chair, its governor, three other board members, and up to two individuals who are neither board members nor employees of the central bank. It is expected to become operational in early 2026. In August, the RBNZ proposed easing lenders’ capital requirements, following criticism that the existing regulations had restricted the availability of funds in the economy and increased costs for borrowers.