Massive jump in foreign bank profits

Profits made by foreign investors in New Zealand banks have leapt to more than $2 billion, the Green Party has revealed.

Party Co-Leader Rod Donald released the figures to coincide with the launch of the Green Party's economic manifesto "Thinking Beyond Tomorrow" at the Wellington Town Hall Council Chamber Foyer at 12.30 today.

He said figures obtained from Statistics New Zealand showed that in the year to 30 June 1999, overseas investors in New Zealand banks made a profit of $2,326 million, up from $674 million in the year to 30 June 1998. The figures do not include profits accruing to any New Zealand investors.

"The actual dividends paid out overseas were $1,372 million," said Mr Donald. "The other $954 million was reinvested in the banks - building the asset value of the investors.

"The huge dividend payout is a significant factor in our rapidly increasing foreign debt and contributes considerably to New Zealand's massive balance of payments deficit.

"The billion dollar reinvestment only ensures that future dividends will exacerbate the problem even further.

"The Greens welcome foreign investors that come as guests," Mr Donald said. "But in the case of banking they've moved in and taken over the kitchen. Now they're making off with the dinner, and we're not invited.

"The Greens are already working with existing locally owned organisations to develop a network of community owned banks, as a small step towards reclaiming our banking industry.

"The Greens offer sensible control of our economy for the benefit of New Zealanders, rather than standing back and leaving multi-national companies to take over and failing to support our own industries in the name of the free market," Mr Donald said.

The Thinking Beyond Tomorrow manifesto includes a range of economic initiatives including transferring tax from work and income to greenhouse gas emissions, toxics and waste. It also proposes community banks, credit unions and regional business support.

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