The past four years were but a fraction of BOV’s 50-year history. Yet, they saw the bank successfully addressing a number of legacy challenges, overcoming new ones and consolidating the foundations for its future growth and sustained contribution to the Maltese economy.

Among the legacy challenges which we overcame, perhaps the most burdensome was the settlement of the Deiulemar litigation in Italy. This removed the shackles on our capital which were curtailing dividend distributions and future balance sheet growth.

At the same time, BOV completed the transformation of its work related to anti-money laundering and anti-financial crime, contributing in no small way to the country’s efforts in this area. These successes enabled the bank to secure its international payment services through the establishment of stable correspondent banking arrangements.

In recalling these events, I cannot miss giving tribute to all those at BOV who have worked so hard to overcome the threats brought by COVID to the livelihood of the many families and enterprises that are clients of the bank. This support came at huge sacrifice.

Dr Gordon Cordina, chairman, Bank of Valletta

Another notable challenge which BOV needed to face came from the significant swings in European Central Bank interest rates. Initially, BOV had to defend its profitability against negative interest rates for a prolonged period of time.

More recently, the bank geared itself to protect its clients and the economy from the effects of the hike in interest rates brought about by the Ukraine war, which could have dented the financial well-being of families with home loans and hurt the competitiveness of businesses, particularly the smaller ones. At the same time, the bank took the steps necessary to reap opportunities from higher rates and to protect its income and profitability for years to come. 

Another important achievement by BOV in recent years was to shore up its capital in an international bond issue, which was also strongly subscribed by investors in Malta. This was a first for the bank and for the country and was achieved in spite of turbulences in the global capital markets which prevailed at the time. The bank will continue to strengthen its capital in coming months, providing attractive opportunities to investors in Malta.

We continue to work to daily serve the needs of 40% to 50% of the economy by ensuring the stability, reliability and availability of our payments, saving and investment, and loan products. This requires us to maintain top-notch IT, liquidity management, risk management and compliance efforts in place, and to keep a close scan on the horizon for future challenges.

Unlike other institutions, BOV cannot take a selective approach on client niches and services with which it engages. We have to be there for all segments of the economy and society to serve them in all of their financial needs and requirements.

Looking ahead, we will keep the bank profitable, strongly capitalised, and at the forefront of the fight against financial crime and threats to cyber-security. We are also strongly compelled to make an impact in terms of digital readiness, as well as on the ESG front, not only through our internal activities, but also by influencing the business models of our clients. BOV will be making sure that the business activities that it supports will have the right sustainability credentials, as the economy cannot afford mistakes on this front, particularly when it comes to sizable projects.

The bank is also looking forward to help in developing occupational pension schemes in Malta: this is work which is currently under way thanks to our important and valued partnership, which this year reaches its third decade, with MAPFRE in our life insurance company, MMSV.

These themes are embedded in our current strategic approach and indeed consolidate the foundations for the bank’s continued contribution to the economy and society of Malta. Our people are at the core of this mission: the bank appreciates their efforts at continuous improvement, learning, adaptability to changing circumstances, and at always placing the customer at the centre of our activities.

This article was first published in the BOV 50th Anniversary magazine.