The Malta Financial Services Authority has defended its role as the regulator of Bank of Valletta, saying the IMF had always praised it and that BOV supervision was actually in the hands of a Joint Supervisory Team.

Fitch Ratings London on Thursday issued a press statement announcing that they had downgraded BOV’s Long Term Issuer Default Rating and Viability Ratings from BBB+ to BBB with a stable outlook. It also commented on the Maltese regulatory framework which “albeit having improved over the past few years, is being implemented less thoroughly than in the most stringent EU countries”.

The MFSA said in a statement that the annual visits conducted by the IMF Article IV delegations always concluded that Malta’s regulatory framework was of a high level. It also pointed out that in the case of BOV, the overall supervision of the bank falls under the auspices of the ECB through an SSM Joint Supervisory Team (JST) which is led by the ECB but includes members of the MFSA’s Banking Supervision Unit.

“The JST overseeing BOV’s operations is undertaking supervision of the bank on an ongoing basis as well as through on-site missions which are initiated by the ECB. Such missions are conducted by the ECB, MFSA, or joint inspection teams which follow the ECB’s SSM manual when undertaking such missions,” it wrote.

BOV issued its own statement on Thursday explaining the steps it has already taken and would take in the near future to address the concerns expressed by the rating agency.