BOV breezes through stress test

Bank of Valletta is expected to pass the EU’s stress test with flying colours, which would indicate it is in a sound financial position that would enable it to face off a severe economic or financial crisis.

Finance Ministers, meeting in Brussels for their regular monthly meeting, were yesterday given a preview of the results of the tests and BOV has proved to be one of the soundest among those tested, The Times has learnt. The results of stress tests involving 91 EU banks will be published later this week.

Asked for a reaction following the meeting, Finance Minister Tonio Fenech said he could not give details of the discussion as it was confidential but he confirmed BOV had achieved very good results.

“You will see that BOV is very sound,” he said.

This is good news for the bank after the controversy over its failed La Vallette Multi-Manager Property Fund, which was in large part settled when 94 per cent of investors took up the bank’s offer of compensation for the fund’s underperformance.

BOV was the only Maltese bank included in this year’s stress tests of EU banks, which evaluated their strength in a worst case economic scenario.

HSBC was selected to undergo the test but on an international and European level and not its Malta operation.

According to EU sources, the results will show that some renowned banks have failed the test and will need state intervention to survive.