Two Bank of Valletta directors declared by the board to be “unfit for re-election” will still run again for office at tomorrow’s annual general meeting.

A suitability-assessment exercise conducted earlier this year found George Portanier and Alicia Agius Gatt to be “unfit for re-election”. However, they would be challenging the bank’s decision and contest tomorrow’s election, financial services sources said.

Mr Portanier, who has served on the board for 22 years, challenged the decision in court. Dr Agius Gatt, the daughter of Parliamentary Secretary Chris Agius, would likewise ignore the board’s decision and run again for election, the sources added.

Efforts to contact Dr Agius Gatt yesterday were unsuccessful.

According to new rules by the European Central Bank, directors of banking institutions have to undergo a suitability test every year.

Since there was no time for the new rules to be fully implemented prior to tomorrow’s AGM, chairman John Cassar White instructed the directors to make a self-assessment. After being declared “unfit”, Mr Portanier took the matter to court, which slammed the bank’s decision and ordered it to stop the procedure adopted.

Calling the internal exercise as “an antithesis of EU banking regulation”, the court said the bank had failed to set up an independent nominations committee, as required by EU rules.

However, Mr Cassar White insisted the process was correct, adding that “the honourable judge made a number of serious allegations about the way the board which I lead conducted the suitability assessment process”.

He insisted that the banking supervisors had approved the way the board made the assessment and pointed out that, ultimately, it was the supervisors who had the final say.

Asked yesterday to say why the two “unfit” board members were still able to contest the election, Mr Cassar White said the supervisors had so far not passed judgement on all the candidates.

He said all candidates would be allowed to run for election “but those elected will still need the clearance of the banking supervisors to actually serve on the board of the bank”.

The sources noted that, once the court had stopped the bank process, “the supervisors will respect the court’s decision”.

The joint supervisory team, which include MFSA and ECB officials, would not give details when asked about its stand on the matter. “The JST does not comment on the details of any procedure in general, nor will it do in this specific one,” a spokesman said.