Stock market: Banking equities gain over 2% each

The share prices of both Bank of Valletta plc and HSBC Bank Malta plc gained over two per cent each this morning following yesterday’s reassuring comments by BOV’s chairman Roderick Chalmers.

During a press conference to explain the EU stress-testing exercise, the chairman stated that the bank will comfortably pass the stress tests as both the loan book and investment hold high quality assets.

Mr Chalmers said that BOV is well capitalized with capital ratios above regulatory requirements.

CEO Tonio Depasqual, also reassured investors that theses stress test are not a challenge to BOV as the bank carries out similar exercises on a regular basis.

Mr Chalmers rebuked the recent comments made by the governor of the Central Bank. He said that despite the new regulations which will require banks to hold further capital, BOV can do this without reducing dividends for shareholders.

The comments by the bank's senior officials renewed demand for BOV shares helping the price recover by 2.3 per cent to €3.06,9 level with outstanding bids already placed at the €3.10 level.

This positive sentiment also spilled over onto HSBC as its share price climbed 2.1 per cent to regain the €2.91 on higher volumes of 14,150 shares. Today, HSBC announced that its half-year results will be published on July 30.

On the bond market, a further USD88,000 (nominal) of the eight per cent BOV USD 2010 traded this morning.

The price of the bonds eased 20 basis points to 100.80 per cent. The Malta Stock Exchange this morning announced that another USD231,000 of these bonds have been cancelled as they were bought back by BOV. The total amount outstanding of these bonds is now just over USD36.2 million.

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