Banks paid €168m in taxes in 2012

The 26 banks forming the Malta Bankers’ Association paid €168 million in taxes on the profit derived from ordinary activities, according to the newly-appointed chairman of the association’s board, Charles Borg.

The Maltese banking sector is very well- capitalised, highly liquid and profitable

Addressing the recent annual general meeting, Mr Borg said the direct contribution of the banking sector to the local economy remained significant.

The number of full-time bank employees is close to 4,000; payroll last year amounted to €130 million and dividends paid to resident shareholders amounted to €59 million.

The combined balance sheet total of the member banks stood at €53 billion as at the end of 2012. The total assets of the five ‘core domestic banks’, which have strong links with the domestic economy, amounted to €14.3 billion (211 per cent of GDP), while ‘non-core domestic banks’, which play a more restricted and limited role in the economy, had assets totalling €5.3 billion (78 per cent of GDP). The total assets of ‘international banks’, which have virtually no link with the domestic economy, amounted to €33.3 billion (492 per cent of GDP).

“These numbers put the size of the Maltese banking sector vis-à-vis GDP in its proper perspective,” Mr Borg said.

Mr Borg also noted with satisfaction that credit to the private sector continued to increase in 2012, as observed in the IMF’s 2013 report on Malta.

Loans and advances to customers by the core domestic banks increased to €8.3 billion, while aggregate lending by all the banks amounted to just under €19 billion.

Customers’ deposits with the core domestic banks also increased to €12 billion, reflecting public trust and confidence in the system, with total deposits of all the banks now exceeding the €20 billion mark.

“The Maltese banking sector is very wellcapitalised, highly liquid and profitable. It is gratifying that in its 2013 report on Malta, the IMF recognised that the remarkable resilience shown by Malta in the face of a major crisis in Europe was underpinned by our sound banking system,” Mr Borg concluded.

The other board members are Edward Cachia, Mario Gauci, Thomas Haag, Cenk Kahraman, Margrith Lutschg-Emmenegger, Joseph Said, Henry Schmeltzer, Joaquim Silva Pinto and Mark Watkinson.