The Reserve Bank of New Zealand is "leaning towards simplifying both the allowable capital instruments and the methods for measuring risk," Deputy Governor Grant Spencer said in a speech to the Kanga News Capital Markets Conference yesterday. "With regard to the current review of bank capital adequacy, though we are in the consultative phase and far from making any decisions," Spencer said. "We do not believe that New Zealand's relatively vanilla banking system warrants a high degree of complexity in its capital regime." Spencer said that the Bank would also review the minimum capital ratios.  New Zealand's relatively high-risk profile, due to high industry and portfolio concentration, supports a conservative approach relative to international peers. Loss rates associated with securitisations of Australian prime car loans have improved over the past, said Fitch Ratings. "Overall, arrears have remained stable for the past 12 months, while the annualised net loss rate has remained below the five-year average of 0.48 per cent," the agency said. In 1Q17, losses decreased by seven basis points to 0.42 per cent, while 30-plus days arrears were at 1.59 per cent, up from 1.40 per cent in 4Q16 and 1.55 per cent in 1Q16. Loss levels stayed well below Fitch's expectations and the agency said it believed current ratings could withstand increased losses. However, Fitch believed that the lower-than-historical-average wage growth may be a major threat to borrower performance.