New Zealand's hopes of defending their World Test Championship suffered a ­major setback when South ­Africa crushed them by 198 runs in the second Test in Christchurch on Tuesday.

It was New Zealand's third defeat in six Tests over the past three months, and their second at home, where they have enjoyed being almost unassailable in recent years. 

A defeat in India in December was followed by a shock first defeat to Bangladesh at Mount Maunganui in January before being outclassed by South Africa at Hagley Oval. 

An emphatic victory in the first Test against the Proteas last week had given New Zealand hopes of a winning their first series against South Africa in 17 attempts dating back 90 years. 

But captain Tom Latham said on the eve of the second Test that a series win was a side issue.

New Zealand's focus was on gaining World Test Championship points to put themselves in a position to defend the title they won by beating India in the final in England last year.

"Points at home are very vital. Nowadays in cricket it's very hard to win away from home, so points in our own country are really important," Latham said.

But they were never really in the hunt after South Africa held a 71-run first innings lead and then cracked 354 for nine in their second innings to set New Zealand a world record 426 to win. 

New Zealand lost their first two wickets for just six runs, went into the final day at 94 for four and were out just after tea for 227. 

It leaves New Zealand sixth in the nine-team standings with 28 Test Championship points from six Tests while South Africa are fourth with 36 from five matches.

"I'm so disappointed to be in this position," Latham said, adding that to make the final New Zealand had to perform much better away from home.

"One hundred percent we do. Obviously you go out with the ambition of winning every Test match you play, especially at home.

"When we head to England in a few months it's important we shift our focus and try our best to win that series over there and get as many points as we can."

With the teams ranked by the win percentage, Sri Lanka head the championship table with two from two (100 percent), followed by Australia (86.66 percent) with four wins from five followed by Pakistan with three from four for 75.00 percent.

Sri Lanka start a two-Test series in India this week while Australia have a three-Test series against Pakistan starting in Rawalpindi on Friday.

England are bottom of the table having lost six of nine Tests with two drawn for a 9.25 win percentage.