The battle of the bank BS is back.

BNZ, who announced their profit last week, talked of the strong competition out there.

But I note their margin went up, up, 6 points to 2.43%.

So if there is so much competition, how come the margin is up?

Then came the claim from the Reserve Bank among others that the big banks are being tardy when it comes to passing on the Reserve Bank cuts to us punters.

Smaller banks are sharper. SBS claims they have hoovered up almost 6000 new customers as changing banks has become easier. Remember SBS last week put out their 3.99% money, limited to certain people, but a market leader nevertheless.

Now tied into all of this is the retail bank's long held argument that the margin is higher because they need the cushion, because the Reserve Bank makes them store away too much money for troubled times.

But, those rules are changing and changing in the retail bank's favour. In other words;  less money required therefore, in theory, it should mean smaller margins.

You can also put in there the simple truth that has always been in play - there is nothing stopping us shopping around. We have a good number of retail banks and they do do deals. I know because I've done deals.

Some banks will shave decent margins to get your business. The trouble is a lot of us are too lazy to try and moaning is easier than hustling.

So who is right? Are the retail banks tardy? Is it a major issue? Is Nicola Willis right when she says things, and by "things" we mean rules, need to change?

I of course have long argued that Willis is too much hype and it's not all that bad. But I'm increasingly moving towards accepting I'm wrong.

As the Reserve Bank points out as wholesale rates drop the margins have risen, and on latest numbers, keep rising.

Maybe, God forbid, Adrian Orr was right when he used to come on this programme and lambaste the banks for making too many excuses.

What I do know is the conditions are increasingly right, either through wholesale rates or the changes to reserve rules, for us to see the margins fall and for the cuts to be passed through in full, and faster.

And the longer that takes to happen the more we need to see the big banks as a problem and bad actors in the economy.  

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