MFSA suspends €25m green bond over accounts publication
Clearflowplus plc reacts to bond trading halt amid Water Services Corporation financial reporting delay
Trading in Malta’s “first-ever” €25 million green bond was suspended last week as the publicly owned Water Services Corporation (WSC) failed to publish its audited accounts in time.
The Malta Financial Services Authority (MFSA) halted trading in the bond for 10 days, which can be extended until the WSC abides by its financial transparency commitments.
Energy Minister Miriam Dalli launched the bond to much fanfare in 2023, saying it both underscored Malta’s commitment to environmental stewardship and positioned the country among the leaders in green finance.
The €25 million raised from the bond is earmarked to finance numerous green initiatives, including the reverse osmosis plant at Ħondoq ir-Rummien and the establishment of solar farms.
The bond’s issuer, Clearflowplus plc acknowledged, in a statement, the WSC was unable to publish its audited 2025 accounts by the April 30 deadline set down by stock exchange rules. Clearflowplus, a subsidiary of the WSC, put the delay down to “unforeseen technological dependencies arising from third-party service providers” and the appointment of new external auditors.
In the interim, the company said it was instead publishing a “draft” set of unaudited WSC accounts “in the interest of transparency”.
The “draft” WSC accounts show that, for 2025, the corporation made a pre-tax profit of €7.1 million, representing a 66% decline on the previous year. This decline in profitability was put down to a budgeted increase in expenditure, most notably in the areas of repairs and maintenance and waste management.
The €25 million raised from the bond was lent by Clearflowplus to the WSC to carry out the green projects. Repayment of the bond by the 2033 deadline is, therefore, dependent on the corporation’s financial health.
Clearflowplus emphasised in its statement that its own audited accounts have been finalised and published, without any concerns raised by its auditors.
The company said that, following a “detailed assessment” of the WSC’s performance and cash flow projections, no concerns were raised about its ability to repay the €25 million loan. “The board is, therefore, satisfied that independent, risk-focused audit scrutiny of the Guarantor [WSC] has been completed without adverse finding, and that the guarantee underpinning the issuer’s bonds remains sound,” it noted.