NZ central bank says vulnerabilities remain in financial system, monitoring housing

WELLINGTON, May 5 (Reuters) - The Reserve Bank of New Zealand said on Wednesday that the country has come through the COVID-19 pandemic better than initially feared, but vulnerabilities in the financial system remain.

The bank said in its Financial Stability report that it is monitoring how the markets respond to the government’s recent housing policy changes aimed at tackling inflated home prices, and was prepared to further tighten loan-to-value ratios (LVR).

"If required, we are prepared to further tighten lending conditions for housing using LVR requirements or additional tools that we are assessing,” said Deputy Governor Geoff Bascand.

(Reporting by Praveen Menon; Editing by Leslie Adler)

((praveen.menon@thomsonreuters.com; +6448028163; Reuters Messaging: praveen.menon.thomsonreuters.com@reuters.net; Twitter: https://twitter.com/Journopraveen))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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