Bank still waiting for list of investors
Bank of Valletta has not yet received from the financial services authority a list of investors who have to be compensated.
The bank said it was “looking forward to receiving the list”, reiterating its commitment to compensate ineligible investors in its property fund.
The list was drawn up by Mazars, an audit firm tasked by the financial services regulator to review the bank’s client files in the wake of regulatory breaches linked to a property fund that went bust.
Mazars finalised the list of bank clients who were not experienced investors and so ineligible to invest in the property fund. It passed on the list to the Malta Financial Services Authority two weeks ago.
The regulator said last week that it would forward the list to BOV for compensation.
The bank yesterday insisted it was committed to do all it could to conclude the issue satisfactorily for the benefit of all concerned.
It was reacting to a statement by Labour economy spokesman Charles Mangion who urged BOV to adopt high ethical standards when dealing with the matter.
“The bank should act on the report’s conclusions and the investors should be immediately informed of the compensation they are to receive,” Dr Mangion said.
He noted that immediate compensation was unlikely to have an impact on the bank’s financial strength.
Dr Mangion also called on the watchdog to strengthen consumer protection in the financial services sector by making sure that those advising clients on investment decisions did so responsibly.
In June, BOV was found to have breached regulations when it sold the high-risk property fund to inexperienced investors.
The authority fined the bank €200,000.
It also appointed Mazars to determine which investors warranted additional compensation.
Mazars had to determine whether the clients satisfied the regulatory condition of having invested $50,000 (€40,000) over the previous five years when they signed a declaration claiming they were experienced investors.
Inexperienced investors will be compensated at €1 per share, less any compensation already paid out by the bank last year.
The property fund went belly-up after it invested in high-risk sub funds that went bust.
BOV suspended trading in the fund’s shares in August 2008, leaving investors high and dry.
Three separate investigations by the MFSA found the bank guilty of breaching regulatory procedures on various counts.