Bank of Valletta has paid €4.6 million to extend its lease of the House of Four Winds from around 40 years to a temporary emphyteusis of 65 years.

The contract was signed last September though it was not ­announced by the bank.

A few years ago, when the government started working on Valletta’s City Gate project, it wanted the bank to move BOV International out of the block on South Street as this was to be ­demolished to ­create a square alongside the Royal Opera House.

The bank was paying just a few thousand euros a year for the site. The House of Four Winds was eventually agreed upon as a substitute.

The property, mainly rooms added in the 20th century to a residence thought to date back to the 1800s, lies on the Valletta bastions with a stunning view of Marsamxett Harbour. It was formerly used by various government ministries but had been left vacant since then parliamentary secretary Jason Azzopardi relocated to offices closer to the Finance Ministry.

The bank agreed to transfer the remaining lease to the new building and signed the deed in 2010. The House of the Four Winds was demolished and replaced by a sleek, minimalist and modern hard stone building, a project which cost “seven-­figures”. BOVI moved to the chairman’s offices on the other side of Zachary Street and the chairman took over House of Four Winds.

However, with around 40 years left to go on its lease, the bank paid the government a lump sum of €4.575 million to extend this by 25 years. It also agreed to pay €33,750 a year as ground rent.

The bank also paid €267,880 in stamp duty on the deed.

The government owns 25.23 per cent of the shares in BOV.

When asked why BOV had paid this amount to extend a long lease, BOV spokesman Kenneth Micallef said:

“You will appreciate, however, that your questions are related to a commercially sensitive matter which we would not discuss ­publicly.”