MFSA orders Satabank to stop accepting deposits, not take on new customers

The Malta Financial Services Authority has directed the bank Satabank to stop accepting further deposits into its customers’ current accounts and to not accept any new customers.

The financial watchdog had earlier this week appointed Ernst and Young Ltd (EY) as a competent person to advise and monitor Satabank in the proper conduct of its business.

The MFSA has now also directed the bank to stop affecting or processing any withdrawal or outward transfers from any accounts held by the bank, and to stop effecting any transfer, sale, placement or any other movement of the bank’s or customers’ assets.

Read also: MFSA appoints auditors to monitor Satabank ‘in proper conduct of business’

It also ordered that the bank retain and preserve all records, data and documents relating to its business and its clients, including those on its computer systems and network, in Malta or any other jurisdiction, as well as any other documentation relating to the bank’s business.

The bank must also ensure all records, data and documents are kept safe and not altered, destroyed, erased, concealed or disposed of in any matter, and must make them accessible to the MFSA at any time.

EY’s appointment has also been upgraded, and it is to now take charge of the Satabank’s assets for the purpose of safeguarding the interest of depositors, and to assume control of the bank’s business and carry out any other functions the MFSA directs it to.

"Satabank has been on our radar for several months and a comprehensive compliance review was carried out jointly with the FIAU," MFSA chief executive officer Joseph Cuschieri said. "I do not wish to comment further at this stage except to what is in the public domain. However I wish to make it clear that we are stepping up our supervision to watch more closely how all MFSA licenced financial institutions are behaving to make sure that our jurisdiction's reputation is protected. Furthermore, business models which fall short of our risk appetite and regulatory standards will not be accepted."

The Central Bank said that following the MFSA’s decisions, Satabank's participation in TARGET2-Malta - a continuous euro payment system for bank transfers of large value - was being suspended.