Political party clubs are closing their accounts with HSBC bank in the wake of an increase in fees and interest rates, which is being interpreted as a shift in the bank’s policy to distance itself from political parties.

While both the Nationalist and the Labour parties confirmed their clubs were switching banks due to the upward revision in fees and interest rates, a spokesperson for HSBC declined to comment.

Sources said HSBC was charging sectional committees around €17 per month just to keep the account open.

This was in line with the bank’s policy not to pronounce itself on customer relationships including on whether an individual or an organisation is a customer or not, HSBC said.

PN deputy leader Robert Arrigo who has been acting as the party treasurer since September told Times of Malta that all of its committees were paying their dues on time and that of all them were in the black.

This is a cost to PN. We must do everything to safeguard our interests

“Ever since 2015, the commitments have always been paid at higher interest rates. This is a cost to PN. We must do everything to safeguard our interests.

“It is very likely that accounts of political parties are not popular with HSBC. Probably Labour has the same problems on its loans,” Arrigo said.

A Labour Party spokesman confirmed that it had been notified by HSBC about the changes. Consequently, most of the sectional committees were transferring their account to Bank of Valletta so as not to incur the fees, the spokesman said.

In recent months, HSBC made headlines in the wake of its plan to downsize operations in Malta. Last October, it announced it was closing eight branches though it insisted this was part of a strategy to focus on digital banking services. Subsequently, it also emerged that the bank was in the process of shedding 180 employees as part of a voluntary retirement scheme.

HSBC reported a pre-tax profit of €30.7 million for 2019, which was a decrease of 20 per cent over the previous year. The decline was attributed to the impact caused by the one-off restructuring provision.