Bank of Valletta has announced the appointment of bank employee Kenneth Farrugia as its next chief executive officer.
Farrugia has worked at BOV since 1985 and is currently the bank’s chief of retail services.
He replaces Rick Hunkin who agreed to move on after concerns over a spending spree on foreign consultancies and a deteriorating relationship with members of the bank’s senior management.
Hunkin and BOV’s board of directors last year reached a mutual agreement for him to move on from the bank.
In a note to the Malta Stock Exchange, signed by the banks’ company secretary, the bank said that its non-executive directors had appointed Farrugia as CEO. He will also sit on the bank’s board of directors as an executive director.
The note states that Farrugia’s appointment is subject to regulatory approval and will become effective upon receipt of such approval.
Farrugia joined Bank of Valletta in October 1985 and has occupied various positions across the banking group. He currently holds the post of chief retail banking officer and sits on the group’s executive committee and on a number of executive management committees.
Farrugia, a Harvard Business School Alumni, is responsible for the bank's personal and micro-business customer segments and the corresponding suite of retail banking products as well as the respective service channels.
He chairs the board of directors of BOV Fund Services Limited and is a director on the board of directors of BOV Asset Management Limited and the Vilhena Funds SICAV p.l.c.
He is also a member of the board of governors of FinanceMalta, and until recently was director and chairman of Malita Investments p.l.c.
The bank said Farrugia is in the process of relinquishing all external commitments.
Hunkin, who has been at the helm of the island’s largest bank since 2020, had raised eyebrows over concerns of his spending on foreign consultants. He gave the thumbs up for six foreign consultants to be engaged on contracts that are set to cost the bank hundreds of thousands of euros this year alone.
The contracts were given the green light by Hunkin at a time when the bank was engaged in a cost-cutting exercise and shareholders are understood to have been unable to reconcile the spend with the bank’s results.
Sources said the bank’s directors had also raised concerns about a consultancy firm engaged last year which is also set to command a hefty fee.
Hunkin’s contract was for a fixed period of three years, expiring in the course of 2022. Formerly an executive at the UK’s Northern Rock Bank, Hunkin joined BOV as its first foreign chief executive.
According to BOV’s 2020 annual report, Hunkin is eligible for a package of €459,000 in salaries and bonuses.
In December 2021, BOV was slapped with a massive €2.6 million fine by the FIAU after failing to properly identify thousands of corporate customers.