**Letter from New Zealand**
I was standing in a small queue outside the bank in Devonport the other morning, watching the familiar ballet of Monday morning deposits and withdrawals, when the man ahead of me mentioned Winston Peters’ latest proposal. “He wants to buy back the BNZ, you know,” he said, adjusting his newspaper under his arm. “Reckons we sold it too cheap back in the day.”
The conversation drifted away as we moved inside, but it struck me how casually this rather extraordinary notion was being discussed — as if the government purchasing a major bank from its Australian parent were no more remarkable than the council buying a new rubbish truck.
New Zealand First leader Winston Peters has indeed announced his party’s proposal to buy back the Bank of New Zealand from the National Australia Bank (NAB) and merge it with the existing state-owned Kiwibank to create what he calls the “National Bank of New Zealand.” He envisions this new entity would be commercially run and designed to compete with the major Australian-owned banks.
NAB purchased BNZ in late 1992 in a deal valued at NZ$1.48 billion. Peters suggests the purchase price then translates to about $3.4 billion in today’s money, though banking experts estimate the current market value of BNZ at around $13.8 billion, with a substantial premium likely required given NAB is under no obligation to sell.
The policy sits alongside Peters’ proposal for automatic KiwiSaver enrolment at birth, with a $1000 Crown contribution for every newborn New Zealand citizen. Both policies arrived during a weekend rally in West Auckland, where Peters described the original sale as being conducted by “a bunch of neoliberal nitwits and twits.”
There’s something quintessentially New Zealand about this moment — the way a fundamental question about economic sovereignty can emerge from the mouth of our most seasoned political performer with the casual confidence of someone ordering fish and chips. Peters, after all, has been in Parliament since before most voters were born, and his institutional memory of the asset sales of the 1980s and early 1990s carries a weight that transcends ordinary political positioning.
Both Prime Minister Christopher Luxon and Deputy Prime Minister David Seymour have already ruled out supporting the buyback proposal, with Finance Minister Nicola Willis describing it as “extremely reckless” and unaffordable. Yet the idea refuses to settle quietly into the category of political theatre.
This is partly because the question Peters raises — about foreign ownership of essential infrastructure — touches something deeper than mere economics. Four Australian-owned banks control about 85 percent of New Zealand’s banking system, a concentration that would be remarkable in most developed economies. When Peters argues that these institutions extract billions in profits annually from New Zealand customers, he’s articulating a concern that extends well beyond party politics.
The proposal also carries echoes of a different economic era, when state ownership of strategic assets was considered not radical but prudent. One thinks of Britain’s post-war nationalisations, or indeed New Zealand’s own history of state-led development, from the Bank of New Zealand’s original incarnation as a government bank in 1861 through to the mixed-ownership model that persisted until the 1980s reforms.
Yet the financial realities remain formidable. Even optimistic estimates suggest the acquisition could cost $20 billion or higher, a figure that dwarfs most government spending decisions. Peters’ suggestion that the purchase could be funded through sovereign banking bonds, Crown debt, and contributions from the NZ Super Fund and ACC, without raising income tax or GST, strikes many economists as wishful thinking.
Peters has dismissed criticism from his coalition partners, noting pointedly that “it was them that sold the BNZ in the first place” — a reference to the National Party government of Jim Bolger that privatised the bank in 1992. This historical grievance lends his campaign a personal dimension that transcends normal policy development.
Perhaps what’s most intriguing about Peters’ proposal is not whether it’s financially feasible, but what it reveals about New Zealand’s ongoing conversation with itself about scale, sovereignty, and the proper role of the state. In a country of five million people, dominated economically by much larger neighbours, the question of who controls the essential levers of economic life carries particular weight.
Whether Peters’ bank buyback represents visionary policy or expensive nostalgia, it has succeeded in forcing that conversation into the open. And in a democracy, perhaps that itself is no small achievement.
The real question, though, isn’t whether we can afford to buy back our bank — it’s whether we can afford to keep having this conversation without ever quite resolving it?
Gibson Foster
May 20, 2026