New Zealand's four major banks maintain strong competitive positions, underpinning their viability ratings, according to a Tuesday report by Fitch Ratings.

New Zealand's banking sector is highly concentrated, with the four major banks holding an 83% share of loans together. Their business models are also similar, focusing on traditional commercial banking activities.

The banks' issuer default ratings (IDRs) continue to be driven by support from their Australian parents.

Fitch revised the outlooks on the long-term IDRs of ANZ Bank New Zealand to A+, ASB Bank to AA-, Bank of New Zealand to A+, and Westpac New Zealand to A+ to positive from stable.

This reflects the likelihood that the anchor rating of each bank's shareholder support rating will shift to the long-term IDR of its Australian parent from the parent's viability rating, once the banks are permitted to issue loss-absorbing capacity instruments to their parents.