BOV registered record profits of more than €302m in 2024, a fifth higher than the previous year, the company announced on Wednesday, with shareholders to receive an unprecedented €85m in net dividends.

In a news conference held on Wednesday afternoon, BOV chair Gordon Cordina said that 2024 was a particularly good year for the bank, which registered strong financial results while bolstering its internal systems to better predict future trends.

The bank’s profits for 2024 are some €50m more than those registered the previous year, BOV CEO Kenneth Farrugia said.

This means that the bank will be able to pay its shareholders some 42.6% of its earnings, Farrugia explained, at a price of €0.2238 gross for each share. Last year, the bank’s payout ratio was 26.3%.

Much of the bank’s profitability stems from its core business, Farrugia said, with the bank’s personal, commercial and home loan lending all up.

Commercial loans are up by 7%, with BOV now snagging just under half the entire local market of commercial loans, while personal loans jumped by 15% since last year.

Meanwhile home loans also grew by 2%, with 40% of all home loans across the country being in BOV’s portfolio.

Meanwhile, the bank’s loan to deposit ratio was up to almost 55% last year, with its return on average equity also rising to almost 23%.

But the bank says it expects profits to dip slightly over the coming years, as falling interest rates bite.

BOV is projecting a profit of between €200 and €250m this year, although its dividend distribution could rise to a maximum of 50%.

BOV announced its results for 2024 on Wednesday. Photo: BOV

BOV following HSBC developments ‘with great interest’

Both Farrugia and Cordina spoke of what they described as a “symbiotic” relationship between the bank and Malta’s economy.

“Last year the country registered 6% economic growth and that is reflected here,” Farrugia said.

Meanwhile Cordina, seemingly in reference to HSBC’s impending departure from the island, said that “as others are retreating, we need to be there to support the economy more than ever”.

But neither would be drawn to comment on a Times of Malta report of a bid for HSBC by Hungarian banking giants OTP.

“It would not be ethical for me to comment,” Cordina said. “But we are following developments with great interest because this is a systemic event.”

Asked whether BOV would welcome the entry of OTP, Farrugia played things down, saying that “there has been the entry of a number of foreign banks to Malta over the  years. This is the development of the sector”.