The euro changeover and banking services
The Malta Bankers' Association in synergy with the Central Bank of Malta and the National Euro Changeover Committee is working to ensure a smooth changeover to the single European currency, the euro. The association is coordinating the changes that the...
The Malta Bankers' Association in synergy with the Central Bank of Malta and the National Euro Changeover Committee is working to ensure a smooth changeover to the single European currency, the euro. The association is coordinating the changes that the banking industry needs to undertake and is playing a leading role in the exchange of information, experiences and strategies with the business community, consumers, national government and other stake holders.
We expect to know the fixed irrevocable exchange rate between the euro and the Maltese lira during the second or third quarter of 2007 setting the scene for euro adoption on January 1. All Lm bank accounts (including all credit account or debit facilities) will be converted into euro after December 31 at no cost to the customer.
On January 2-3 the banks will open solely for cash exchanges from Maltese lira to euro and foreign exchange transactions for the travelling public but normal banking services resume on January 4. There shall be a month-long dual circulation period but the banks will continue to accept Maltese lira notes and coins for three months, ending on March 31, 2008.
After that one will be able to change Maltese lira notes and coins at the Central Bank of Malta for 10 years and two years respectively.
During the changeover period the banks will apply a household limit of Lm250. This means that non-bank customers will be able to change only up to Lm250 once.
Exchanges for the banks' customers will be without without limitation, but may be subject to a two days' notice period if the amount to be exchanged exceeds Lm250. Such measures are being applied for security reasons.
It is very important to facilitate the cash changeover process by depositing surplus cash holdings (whether lira notes or coins) into the banking system from now. There is clearly a significant amount of coinage that is not being used for commerce and which is lying idle around in offices or houses. Over the next nine months, a few hundred tons of Maltese lira coins need to be collected from circulation. It is important that this coinage enters the banking system gradually. Cooperation and mutual understanding by the banks, the business community, national authorities and the general public will go a long way for this process to run smoothly.
In the very near future as stated in the last masterplan, the national authorities shall be launching a dehoarding campaign in this regard. In the area of cheque books the banks shall be supplying cheque books bearing the euro currency symbol as from January 1, 2008. However, during the course of 2007 some banks may also opt to issue cheque books with no currency symbol printed. In such event, the account holder must fill in the appropriate currency symbol when writing out a cheque: Maltese lira if a cheque is issued prior to January 1, and euro if a cheque is issued after December 31. Within the coming months, the MBA will be embarking on a communications strategy to inform the business community and the public about the euro changeover project.
• Mr Cassar Torreggiani is the Executive Head responsible for the euro changeover programme at Bank of Valletta.
We expect to know the fixed irrevocable exchange rate between the euro and the Maltese lira during the second or third quarter of 2007 setting the scene for euro adoption on January 1. All Lm bank accounts (including all credit account or debit facilities) will be converted into euro after December 31 at no cost to the customer.
On January 2-3 the banks will open solely for cash exchanges from Maltese lira to euro and foreign exchange transactions for the travelling public but normal banking services resume on January 4. There shall be a month-long dual circulation period but the banks will continue to accept Maltese lira notes and coins for three months, ending on March 31, 2008.
After that one will be able to change Maltese lira notes and coins at the Central Bank of Malta for 10 years and two years respectively.
During the changeover period the banks will apply a household limit of Lm250. This means that non-bank customers will be able to change only up to Lm250 once.
Exchanges for the banks' customers will be without without limitation, but may be subject to a two days' notice period if the amount to be exchanged exceeds Lm250. Such measures are being applied for security reasons.
It is very important to facilitate the cash changeover process by depositing surplus cash holdings (whether lira notes or coins) into the banking system from now. There is clearly a significant amount of coinage that is not being used for commerce and which is lying idle around in offices or houses. Over the next nine months, a few hundred tons of Maltese lira coins need to be collected from circulation. It is important that this coinage enters the banking system gradually. Cooperation and mutual understanding by the banks, the business community, national authorities and the general public will go a long way for this process to run smoothly.
In the very near future as stated in the last masterplan, the national authorities shall be launching a dehoarding campaign in this regard. In the area of cheque books the banks shall be supplying cheque books bearing the euro currency symbol as from January 1, 2008. However, during the course of 2007 some banks may also opt to issue cheque books with no currency symbol printed. In such event, the account holder must fill in the appropriate currency symbol when writing out a cheque: Maltese lira if a cheque is issued prior to January 1, and euro if a cheque is issued after December 31. Within the coming months, the MBA will be embarking on a communications strategy to inform the business community and the public about the euro changeover project.
• Mr Cassar Torreggiani is the Executive Head responsible for the euro changeover programme at Bank of Valletta.