Advertisement
New Zealand markets open in 1 hour 56 minutes
  • NZX 50

    12,292.03
    +107.54 (+0.88%)
     
  • NZD/USD

    0.6079
    +0.0029 (+0.47%)
     
  • ALL ORDS

    8,303.50
    +60.20 (+0.73%)
     
  • OIL

    82.88
    +2.12 (+2.63%)
     
  • GOLD

    2,462.60
    -5.20 (-0.21%)
     

Forum seeks fix for Pacific's sinking banking services

Disappearing banking services and boosting financial security in the Pacific region are the focal point for policymakers, finance institutions and international organisations at an Australian forum.

Turning the tide on the closure of banks in the Pacific is high on the agenda in Brisbane during the two-day forum which started on Monday.

The Pacific Banking Forum was an important outcome of the meeting between US President Joe Biden and Prime Minister Anthony Albanese last year, Pacific Minister Pat Conroy said.

President Joe Biden and Prime Minister Anthony Albanese at APEC 2023.
US President Joe Biden and Prime Minister Anthony Albanese announced the forum in October 2023. (AP PHOTO)

"This is a really good opportunity - banking is one of the key pressure points in the Pacific," he told AAP.

ADVERTISEMENT

"We're really grateful for banks like Westpac and ANZ having a strong presence in the region."

Co-hosted by Canberra and Washington, 300 people - including Pacific leaders as well as representatives from commercial banks and international organisations, such as the International Monetary Fund - will take part in the event.

Mr Conroy is set to meet with leaders on Tuesday at the world-first event.

The talks will dig into the causes of withdrawing correspondent banking relationships, which are where financial institutions provide services on behalf of another bank, usually in a foreign country.

Security concerns have also been linked to the decline in bank services with China's moves in the region ever-present in the background.

Last April, Nauru, which uses Australian dollars as its currency, signed a memorandum of understanding with state-owned Bank of China, after Bendigo & Adelaide Bank announced it was pulling out by December this year.

Preventing banking services from leaving the region was "vital to the safety, security and economic development", Treasurer Jim Chalmers said.

Australia's Assistant Treasurer and Financial Services Minister Stephen Jones delivered the opening address on Monday.

"Australia is committed to our Pacific partners and a sustainable financial system is integral to the strength of our region," he said.

The US also had a presence with Brian Nelson, the US Treasury's under secretary for terrorism and financial intelligence, telling the meeting of its concern about the decline in regional banking.

"We share the concerns that Pacific Island countries are experiencing among the most serious declines in correspondent banking relationships in the world," Mr Nelson told the meeting "The vast and dispersed geography of the region makes correspondent banking even more critical for clearing foreign exchange payments, promoting trade and development and facilitating remittance flows."

"This geography can also, however, make it difficult and expensive for banks to offer services to each island."