Malta’s major banks notch up €21.3 billion in total assets

Maltese banking maintains buoyant trend, generating €100 million in tax on profits in 2016 

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Matthew Vella
12 September 2017, 3:16pm
Malta’s bank owners have reported a well-capitalised, highly liquid and profitable industry, with a combined balance sheet total of €21.3 billion amongst the seven “core domestic banks”, which have the strongest ties with the domestic economy.

The sum represents 215% of Malta’s gross domestic product, a ratio which is well within the EU average.

Total assets of all the Malta Bankers Association’s 27 member banks stood at €44.5 billion.

Customer deposits with the core domestic banks maintained their upward trend, increasing by a further 8% to reach a record €17.7 billion (2015: €16.4 billion). Total deposits with all the banks now stand at €24.3 billion.

MBA secretary-general James Bonello said that with a loan-to-deposit ratio of around 60%, banks have more than excess liquidity to support the development and growth of the Maltese economy by providing credit facilities to households and businesses.

Bonello added that core domestic banks remain committed to ensure the proper financing of the economy, despite the new and more restrictive regulatory regime following the 2008 global financial crisis, from which Maltese banks emerged unscathed.

During 2016, credit provided by these banks increased by 2.9% and stood at €9.63 at the year-end (2015: €9.38 billion). “This increase is net of substantial loan repayments effected during the year, partly through normally agreed repayment programmes and partly also through the proceeds of bond issues launched on the market by corporate clients,” Bonello said.

Bonello also said that new economic sectors such as e-gaming and I.T. were not too capital intensive, and did not require high levels of financing as may be the case with other established sectors.

Banking in Malta employs 4,376 full-time employees, with a payroll of €171.5 million, generating almost €100 million in tax on profits in 2016 and €54.9 million in dividends to resident shareholders.

“Continued public confidence and trust in the local banking system is evident from the foregoing. This assertion is supported by the World Economic Forum’s Competitiveness Report 2016-2017, which ranked Malta 16th out of 140 countries for the soundness of its banking system. This is key and very gratifying,” Bonello said.

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Matthew Vella is executive editor at MaltaToday.