Kiwibank Limited is a New Zealand state-owned bank and financial services provider. As of 2023, Kiwibank is the fifth largest bank in New Zealand by assets and the largest in New Zealand, with a market share of approximately 9%. In December 2023, the bank's total assets were approximately $35 billion.

In 2001, New Zealand's fifth Labor government, following a proposal by then Deputy Prime Minister Jim Anderton, established a local bank capable of competing with the big four Australian banks that dominated the domestic market. Initially, it operated as a subsidiary of New Zealand Post, with branches initially located within PostShops (post offices) to ensure nationwide accessibility.

History

A PostShop on Wellesley Street in Auckland, New Zealand is also a branch of Kiwibank.

The early state-owned bank

Kiwibank is similar in some respects to the early Post Office Bank, which is owned by the New Zealand government. The Post Bank of New Zealand was established in 1867. In 1987, the bank was corporatized and spun off from New Zealand Post and Telecom New Zealand to form a separate company, Post Bank. Then in 1989, PostBank was sold by the government to ANZ Bank.

Founding Period (2002-2010)

In his farewell address, Jim Anderton revealed that he spent three hours trying to convince then-Treasurer Michael Cullen, who Annette King told Cullen: "Michael, Jim defeated every argument we ever made against the bank. For God's sake, give him the bloody bank. Cullen replied:" Oh, well.

In 2008, an analysis suggested that Kiwibank had promoted increased competition in New Zealand's banking sector by lowering fees. In addition, by 2007, Kiwibank had higher customer satisfaction than the four major Australian banks operating in New Zealand. In 2008, Kiwibank launched an advertising campaign called "Join the Campaign", which portrayed foreign-owned competitors as enemy occupiers. The New Zealand Herald called the campaign "chauvinistic".

Since 2010

New Zealand Post and Kiwibank shopping at The Palms Mall in Shirley, Christchurch

Kiwibank posted an after-tax profit of $21.2 million for the year ended June 30, 2011.

In 2012, Kiwibank celebrated its tenth birthday. The ad campaign uses what 10-year-old Kiwis pledge they stand for, with New Zealand musician Neil Finn agreeing to use his song "Can You Hear Us?", which was re-recorded by Jeremy Redmore of Midnight Youth. This is the first time the artist has allowed one of his tracks to be used by a commercial entity. Proceeds from the first 20,000 downloads of the soundtrack went to the Music Foundation of New Zealand, of which Finn is a patron.

In 2012, the bank also released a iPhone mobile banking app, following the launch of the redesigned Kiwibank website. Standard & Poor's downgraded Kiwibank's credit rating from AA- to A + (stable outlook) and Kiwibank reported a record profit after tax of $79.10 million for the year ended 30 June 2012.

In 2016, New Zealand Post announced the successful completion of the sale of a 47% stake in Kiwibank to New Zealand Pension Fund (25%) and Accident Compensation Corporation (ACC) (22%).

On 22 August 2022, the New Zealand government acquired Kiwibank's holding company, Kiwi Group Holdings, for approximately NZ $2.10 billion. As a result, the government took full control of the state-owned bank from the New Zealand Pension Fund, the ACC, and New Zealand Post. [19] In response to the government's acquisition of Kiwibank, the KiwiSaver provider argued that the government would have sold some shares to the public. David Seymour, leader of the opposition ACT party, called for the sale of part of Kiwibank to the pension fund. Similarly, the opposition National Party questioned the Labor government's ability to manage New Zealand banks.

In June 2024, the Commerce Commission brought 21 criminal charges against Kiwibank for systemic breaches of the arm's length transactions Act 1986. The alleged violations involved overcharging more than $7 million in home loans, credit card and overdraft fees and interest rates to more than 36,000 customers over several years since 2002. In mid-July 2024, Kiwibank pleaded guilty to a "systemic violation" charge under the arm's length transaction act of 1986.

Core business activities

Kiwibank branch in Newmarket

Kiwibank's core business includes personal banking, commercial banking, KiwiSaver and other wealth services.

Kiwibank personal banking

Personal banking products and services include home loans, personal loans, credit cards, daily accounts, savings accounts, investment services and insurance products.

Kiwibank Commercial Banking

Commercial banking products and services include business loans, checking accounts, credit cards, investments, merchant services, payment services and insurance.

Investments

In June 2006, Kiwibank invested NZ $8 million in a 51% stake in the New Zealand Housing Loan Corporation, a housing lender specialising in debt reduction, and added a further 25% in 2008 and acquired a 100% stake in 2012. New Zealand Home Loans continues to grow, offering an alternative to the traditional banking model and has a national network of over 75 concessions.

In 2012, Kiwi Group Holdings (the parent company of Kiwibank) acquired Gareth Morgan Investments (GMI) for an undisclosed sum. In August 2013, GMI reached the milestone of $2 billion in funds under management.

In 2015, Gareth Morgan Investments (GMI), renamed Kiwi Wealth, provides global investment management and private portfolio services to retail high net worth, pension funds and institutional clients.

In 2018, Kiwi Wealth had more than $6 billion in assets under management (AUM).

Awards

Kiwibank won the Sunday Star/Cannex Bank Awards in 2006, 2007, 2008, 2009, 2010 and 2012 for the best value in its product range. It also won New Zealand's Most Trusted Bank in the Reader's Digest Trusted Brand Awards from 2006 to 2017.

CanStar Awards include:

• 2011, 2012, 2013, 2014, 2015, 2015, 2016, 2017 First Home Buyer Bank
• 2015, 2014, 2016 Best Value Time Deposit

Other awards received by Kiwibank include:

• 2009, 2010 New Zealand Bank of the Year, The Banker Magazine
• 2006, 2007, 2008, 2009, 2010, 2012 Sunday Star Bank of the Year
• 2013 Global Finance New Zealand's Best Bank
• 2013 AUT Business School Excellence in Business Support Award Top Award
• 2012, 2013, 2014, 2015, 2015, 2016 Roy Morgan Grand Bank of the Year Award

In 2015, the Kiwi Wealth KiwiSaver Scheme (operated by GMI) was awarded the inaugural New Zealand Consumer People's Choice Award.

Sponsorship

From 2012 to 2014, Kiwibank was one of the main sponsors of The Block NZ.

In 2012, it sponsored the CFA Institute Research Challenge, hosted by the Chartered Financial Analyst Institute of New Zealand.

New Zealand's first Fintech Accelerator was launched in 2016 under the sponsorship of Kiwibank. The three-month business growth program of the Kiwibank Fintech Accelerator in 2018 resulted in seven start-ups and was supported by Xero, MasterCard and Microsoft. These businesses are: AccountingPod, Tapi (officially known as FlatFish), Liberac, Sharesies, Teddy, Wicket and the Xero team. In July 2019, the take-up of the Kiwibank FinTech Accelerator included BankEngine, Cove Insurance and Miuwi.

corporate social responsibility

Kiwibank is the main sponsor of the New Zealand Person of the Year Awards

In May 2016, the partnership with Banqer, a provider of financial literacy for children, was officially launched, setting a one-year target of funding 1,000 classrooms. This target was achieved in April 2017, but the programme continues to grow.

In 2016, Kiwibank announced a partnership with the Predator Free New Zealand Trust and the Department of Environmental Protection (DOC). Kiwibank has partnered with PFNZ to establish the Kiwibank Predator-Free Communities Program, which works with communities that want to take on the predator-free challenge.