Kiwibank gets $225m capital injection

Kiwibank investment

Kiwibank, New Zealand’s fifth biggest bank, is set to receive a $225 million capital injection from its parent company Kiwi Group Capital (KGC), enabled through the sale of KGC’s wealth arm late last year.

Kiwibank chief executive Steve Jurkovich said the investment would enable the government-owned bank to “deliver on its growth ambitions”.

“Kiwibank has a unique role to play in the New Zealand banking sector and this is another important step in strengthening our position further in the market.”

The investment was funded from the proceeds of the sale of Kiwibank’s former investment management arm Kiwi Wealth to Fisher Funds late last year.

Kiwi Wealth, then known as Gareth Morgan Investments, was purchased by Kiwibank’s then parent, Kiwi Group Holdings Limited (KGHL), in 2012.

As at December 2022, Kiwi Wealth has more than 500,000 clients and more than $22 billion in funds under management. In 2008, it became a superannuation provider.

KGC was established in November 2022 as a holding company to acquire and oversee the NZ Government’s investment in its subsidiaries Kiwibank and New Zealand Home Loans (NZHL), and indirectly through those subsidiaries, to carry out and develop their businesses, including the provision of banking and financial services.

In March 2023, KGC amalgamated with KGHL, the previous 100 per cent shareholder of Kiwibank.

KGHL was previously part-owned by New Zealand Post, alongside New Zealand Superannuation Fund and the Accident Compensation Corporation (ACC), with the latter two holding a minority stake in the company.