A commentary on September 27, 2025, highlights that poor governance is stalling New Zealand’s productivity growth, with the Reserve Bank’s capital settings being too strict. This suggests a negative environment for businesses seeking loans, particularly for productive investments beyond residential mortgages. For investors, this points to potential underperformance in New Zealand’s broader economy and specific sectors. The focus on residential mortgages over business lending could indicate an unhealthy market dynamic. Investors should be wary of companies heavily reliant on domestic lending and seek opportunities in sectors less affected by these governance issues.