Shareholders approve privatisation resolutions

Bank of Valletta has registered a pre-tax profit of Lm18.4 million for the financial year that closed last September, a 25 per cent increase over the previous year, its new chairman, Roderick Chalmers, told the annual general meeting at the Mediterranean Conference Centre, in Valletta yesterday.

In view of the results, the board of directors recommended a final dividend of 10c per share, making a total distribution of 16c per share for the year, up 45 per cent on the previous year, Mr Chalmers said.

The BOV chairman praised his predecessor, Joseph F. X. Zahra, and thanked him for his work during his six-year stint in office.

Mr Chalmers said the appointment of Tonio Depasquale as the bank's chief executive officer was an important step towards good corporate governance, with which the company sought to separate and distinguish between the roles and responsibility of the board and that of executive management.

Mr Chalmers said the current year was full of both challenges and opportunities. "Challenges come from the impact on the economy as the government seeks to reduce the budget deficit. It is clear that the entire tourist market, the lifeblood of Malta's economy, is undergoing major structural change. It is also clear that the open markets of the EU have put some formerly protected businesses under severe pressure. So is Malta's gradual transformation from low cost manufacturing to a higher value and services oriented economy," he said.

Mr Chalmers referred to the so-called "privatisation" of BOV. "The board believes that it is important that we bi-focate the matter, separating the question of the sale of the shares from the role of the bank in this process.

"Insofar as the sale of the shares is concerned, the board believes that this is a matter for the shareholders and the shareholders alone. Certainly, it is clear that there are differing views on the sales of shares by the government but it is our firm view that this is not a matter for the board in our capacity as directors of the bank," he said.

As to whether the bank should be involved in the process, the chairman said the board of directors may "stay away from events and passively await the outcome of the privatisation process" or else be "active participants in that process".

"Our considered view is that we should choose the latter course and we have informed the disposing shareholders accordingly," Mr Chalmers said, adding that the board would rather be in a position to "exert a degree of influence" than being excluded from the process altogether.

Mr Depasquale said that during the past financial year the group continued to implement a strategy based on three pillars, namely, the strengthening of core operations, increasing non-interest income and an added focus on cost-efficiency.

The AGM received and approved the Profit and Loss Account and Balance Sheet for the year ended September 30 and the Directors' and Auditors' Report. A gross dividend of 10c per share, which represent a gross payment of Lm5,541,644.10, as recommended by the directors, was approved and paid.

Two ordinary resolutions related to the privatisation of the bank were submitted to a vote. Shareholders were asked to authorise the disclosure of information, including unpublished price sensitive information, in view of the negotiating process leading to privatisation.

The government and Banco di Sicilia SpA, as the two main shareholders, had in a letter last October advised the board of directors to initiate a process leading to the joint appointment of an independent financial advisor and the joint sale of their shareholding in Bank of Valletta to a strategic investor.

The shareholders approved both resolutions.

The new board of directors of the bank after yesterday's AGM consists of Roderick Chalmers, chairman, Joseph Borg, Roberto Cassata, James Grech, Franco Masini, Marlene Mizzi, George Portanier, Norman Rossignaud, Franco Xuereb.

Mr Chalmers and Mr Grech were appointed by the government in representation of its shareholding while Dott. Cassata was appointed by Banco di Sicilia in representation of its shareholding. The other six directors were elected yesterday.