Bank of Valletta shareholders expressed concern over a €360 million claim brought against the bank by Italian bond holders when they met at an extraordinary general meeting this morning.
The shareholders were asked to approve four resolutions, including a new memorandum and articles of association for the bank and an increase in the bank’s share capital to €1 billion.
However, the first part of the EGM was overshadowed by concerns raised by some shareholders over the Deiulemar case that was brought in front of the court at Torre Annunziata in Italy.
The case goes back three years when BOV was formally notified of a quantifiable claim against it brought by the liquidators of the Deiulemar Group, a shipping company, and representatives of thousands of Italian bond holders over three trusts held by the bank.
Last April the Italian court decided that the court at Torre Annunziata had the jurisdiction to hear the case, something which caught the eye of a bank shareholder.
However, BOV chairman Deo Scerri said the case had not even started being heard and the April decision was only one linked to jurisdiction. He insisted the bank had legal advice from its Italian lawyers telling it that BOV was not legally liable.
The EGM was characterised by concerns from shareholders that the proposed increase in the bank’s share capital would dilute their holdings.
Mr Scerri brushed off a request by financial services practitioner Paul Bonello for the bank to commit itself that in the eventuality of an out of court settlement, directors would seek shareholder approval.
“We are still very far away from that point and if that ever becomes the case, any such decision [to seek shareholder approval] would have to be taken by the board at the time,” Mr Scerri said.
The EGM was characterised by concerns from shareholders that the proposed increase in the bank’s share capital to €1 billion from the current €500 million would dilute their holdings.
Mr Scerri explained the increase in authorised share capital did not mean the bank was going to issue all the shares to the public but this was rather a move to create a buffer for future expansion if needed.
The only increase in issued share capital on the horizon, he said, was a €150 million share issue. Mr Scerri said the bank would keep the interests of small shareholders in mind when it came to the share issue.
Although the four resolutions were approved by a show of hands, some shareholders asked for a written ballot to be taken on the extraordinary resolutions linked to the change in memorandum and increase in authorised share capital.
The ballot results overwhelmingly confirmed the approval given by show of hands.