Moody's confirms BOV's credit ratings

Moody's Investor Service, the global credit ratings agency, has confirmed Bank of Valletta's credit ratings, Baa1/Prime-2/D+ with a stable outlook.

In its latest ratings report, the agency said that BOV's financial strength rating is underpinned by its dominant market position as well as its "rebounding profitability on the back of improved operating efficiency, sufficient capitalisation and excellent liquidity and funding profile.

"With a market share of over 40 per cent BOV ranks as the largest Maltese bank," confirmed Moody's, adding that the bank's "strong franchise and complete range of financial services provides it with access to all business activities in the country and supports its financial strength rating (FSR)".

"The bank's size affords the bank incontestable brand recognition in the domestic market while management makes no excuses for capitalising on the brand, and in fact promoting its image as the Maltese bank," the report added.

It also highlighted how the bank has long-established relationships with international banks, which it has historically utilised to broaden its product offering.

It said the bank has held its ground with regard to more sophisticated financial products, even increasing its market presence in some areas.

Moody's acknowledged the bank as Malta's principal deposit-taking institution, commanding a market share of 46 per cent in residents' deposits. This provides it with access to ample liquidity, providing further potential for it to grow its balance sheet.

The bank's retail strategy has also been facilitated by its alternative-delivery channel approach. "Its '24x7 services' channels...have been increasingly used by the customer base. At the same time the branches' back-office operations have been centralised, thereby freeing staff for servicing clients," said Moody's.

BOV's chief executive officer, Tonio Depasquale, expressed his satisfaction at the positive report, saying it acknowledged the strength of the BOV brand in the market and the validity of the strategies being implemented.