Yeah, kiwibank and the accounting practises used under IFRS make kiwibank a very attractive balance sheet item for the NZ Government.
The labour government is very good at raising public sentiment using emotive words but in practise none of what they say actually holds. The bank inquiry for one is a much laughed topic. great at making the public outraged at ludicrous fees etc, but yet empirically inept.
The NZ Govt. needs to separate itself from kiwibank as currently kiwibank holds a wholesale funds guarantee by the govt itself. This means it can raise capital on an international market, and its funds guarantee is secured by the NZ government, and thus the taxpayer. It is the only bank in the country to do so (and one of the few in the world), and is a protectionist measure for fear that kiwibank was going to be squeezed out of the market when it first started.
What the current government is suggesting is not a sale of the assets, (although I think it should be on the table and privatised, as should many other govt. sectors including ACC) but a partial sale of business to investors to raise capital, enhance the financial security and liquidity of a bank that on its own holds no where near enough capital given its current level of risk.
On its own kiwibank is not in any position to hold extra capital to make up for its vast growth in assets - as residential home loans, funded by very short term liabilities in the form of current account deposits. This mismatch is tricky for them to manage and is certainly an expensive process as kiwi needs to hold large amounts of govt. stock in its tier I capital... only... wait - this is the kicker. since they are owned by the govt, it is no different to the govt. holding its own stock.
It is sooo easy to get swayed by the comments that some political parties are making, as the strike a nerve with many that listen to them; but in reality not one of those claims have real evidential support. its all hearsay.
Standards and Poors themselves said kiwibank only had its current credit rating courtesy the NZ government. Then there is the added problem of separating post shop and kwibank's business. The task is near impossible given how the 2 businesses account for assets and expenses.
Ponder this - if someone was to sell kiwibank; who gets the land asset (the branch) - will it be kiwi bank, the post shop or the NZ govt that owns NZ post; or will it be a mixture of all three?
how do the staff and salaries get split?
what happens to kiwibanks staggering branch network?
I would not want to be the person overseeing the sale of that asset.