New Zealand central bank governor says leadership is not to blame for staff turnover

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Updates with comments on staff turnover, housing market

WELLINGTON, Dec.15 (Reuters) – Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr told a parliamentary panel on Wednesday that recent senior staff departures have resulted from operational changes and individual choices rather than of problems with his leadership.

Bank supervisory chief Andy Wood and financial system policy and analyst Toby Fiennes will be leaving the central bank, the RBNZ said on Tuesday.

Their departures follow those of Deputy Governor Geoff Bascand and Chief Economist Yuong Ha, announced earlier this year.

Asked by a parliamentary panel during the annual central bank review, Orr, who has headed the RBNZ since March 2018, said he was convinced his leadership had not led to conflicts that would have forced people to to leave.

“I am extremely confident in this point of view,” said Orr.

“We’re going through significant business growth and change. We’re doing it in a very planned and strategic way and we’ve done it in an incredibly transparent way,” Orr said.

“What you talked about are the results, in part, of individual choices of whether they want to stay or go,” he said.

Orr said RBNZ’s senior leadership has grown from six to eight and that all of the changes are part of “preparing for the future.”

The central bank has been blamed for a housing crisis that has pushed prices up by around 30% in just 12 months, due to low interest rates and cheap access to capital.

When asked if the RBNZ had ‘overcooked’ the monetary stimulus in the past 18 months, Orr replied, ‘No. We went through an incredibly unprecedented economic shock in a very strong position.

But he said there was no need to maintain the current level of monetary stimulus.

“We are therefore one of the first central banks in the world to tighten monetary conditions.”

Orr said in his opening statement that the RBNZ will continue to raise the official spot rate (OCR) and expects it to eventually exceed its neutral rate of 2%.

The RBNZ raised interest rates for the second month in a row in November to control soaring consumer prices and said more hikes were on the way.

(Reporting by Praveen Menon; Editing by Peter Cooney)

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