Global Capital has made a binding offer to acquire the majority 49 per cent shareholding in Lombard Bank Malta plc, which sources said was €8 million higher than that being made by the IIP fund.

The IIP fund – officially the National Development and Social Fund – has intervened to try to speed up the sale of shares held by the Cyprus Popular Bank, which is under pressure to compensate depositors and shareholders left with empty pockets after the bank's collapse.

Read: IIP fund’s stake in Lombard would be temporary

The situation is exacerbated by the fact that the courts in Malta ruled in 2013 that CPB could not sell its shares until the compensation was sorted out, according to other sources.

Global Capital chairman Paolo Catalfamo.

Global Capital said in a statement on Tuesday that it was offering its own solution and was willing to speed up the process by waiving the requirement for a due diligence procedure.

Global Capital – which holds the second largest stake in Lombard Bank –submitted its offer in writing to the Special Administrator for CPB. The offer is financially supported by York Capital, a private equity fund with over €25 billion under management, and by other institutional and private investors.

Global Capital executive chairman Paolo Catalfamo said: "We believe our offer is very beneficial to the shareholders of Lombard Bank and those of Global Capital. We are also in a position to create many synergies with Lombard  and Maltapost plc, in which the bank holds a 70 per cent shareholding, since Global Capital is today primarily an insurance business. It’s a win-win for all entities.”

The company added that its offer upheld the European Union recommendation for the “creation of a competitive environment” in the sale of stakes in public companies like Lombard Bank Malta.

The shares were put up for sale by the CPB's special administrator a year ago and 20 bids were made, however, the process floundered in summer with nothing happening since then.

The Times of Malta reported on Monday that the deadline imposed by the European Central Bank and the European Banking Authority for depositors to be compensated was summer 2018.

Sources had also said that the IIP fund was only purchasing the shares “temporarily” to break the impasse over the sale and that it would then review the various options.