The cost of the multimillion-dollar renovation of the Reserve Bank's Martin Place headquarters could surge by even more than its current billion-dollar blowout.

The price tag attached to the project was initially $260 million, but that has since ballooned to $1.2 billion due to a huge amount of asbestos found in the building.

When asked about the renovation by federal parliament's economics committee today, RBA governor Michele Bullock warned the cost could blow out even further.

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"I'd have to say not 100 per cent confident," Bullock said when asked how sure she was that the budget would stay at the current $1.2 billion.

"But that's part of the reason why, under the new governance board, we've got some very targeted stage gates, which we're going to be looking at, and how the costs are lining up. 

"The very first piece, though, is that we have to remove the asbestos."

Bullock said there was substantially more asbestos in the RBA headquarters than what is typically found in other buildings constructed around 60 years ago.

"We built a building, it seems, that had 4-5 times more asbestos than any other building of a similar time, and we have to remove (it)," she said.

"So that'll be the first bit, and from then, we can start to look at where the costs might be.

"But my confidence? I'd have to say low."

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The amount of asbestos has turned the project from what would have been a refurbishment of 65 Martin Place into almost a full knock-down, with the building to be stripped back to its steel frame and rebuilt once the asbestos has been removed, before it is then properly fitted out.

Bullock also said the bank hadn't started to look in detail at the cost projections for stages 2A and 2B – the rebuild and refit, respectively – of the project.

"Let me just say that renovation is not what it is anymore, and I really would rather not be in this position," she said.

"I'm not a developer, and what we are now faced with is a development."

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