Updated 7.07pm with BOV chairman's statement

A massive €363 million precautionary warrant filed against Bank of Valletta has surprisingly been upheld by an Italian court, but the bank will be appealing the decision.

The bank's chairman has also insisted that operations and shareholders' interests are not affected. 

The claim was filed by liquidators of the Deiulemar group and representatives of 13,000 Italian bondholders who lost all their life savings in a fraud scheme dating back to 2009.

The €363 million is believed to be held in trust at BOV by owners of the collapsed shipping giant Deiulemar, which went bankrupt in 2012 with losses of more than €800 million on its books. Seven people were jailed as a result of the collapse.

Liquidators for the Deiulemar group believe that BOV allowed owners to set up three trusts in 2009 - Capital, Giano and Gilda - which they illegally funneled millions into.  

A court at Torre Annunziata has now ordered the disputed €363 million to be seized and held through a precautionary warrant.

'Case still at preliminary stage' - BOV

In a company announcement, BOV said that proceedings in the case were still at a preliminary stage, noting that the tribunal had yet to hear the case. 

The bank said it would be appealing the decision to issue a precautionary warrant against it, saying it was "firmly rebutting the claims instituted against it before the Italian tribunal." 

Regulators were being continuously updated on developments related to the case, it added.  

Bank chairman Deo Scerri in comments to journalists reiterated that he believed BoV had a solid case and it did not need to make any provisions.

The Italian court's decision will have no impact on shareholders, he stressed.

BoV has €11.8 billion in assets and €2.9 billion in cash with European Central Bank.

We found it strange how a bank regulated by the ECB is being suspected of having the possiblity of running away with the case. It’s incredible- chairman

“We found it strange how a bank regulated by the ECB is being suspected of having the possiblity of running away with the case. It's incredible,” Mr Scerri said, adding that the problem has no problem to put the money aside.

He also pointed out that the credit rating of BoV is higher than the top five Italian banks.

“They are saying that we should put the money in a bank which has a lower credit rating than ours.”

Pointing out that the case was unprecedented, the chairman insisted the bank operations will not be impacted in any manner.

“Even if we lose the case at the Torre Annunziata court, we will seek other avenues to support interests of shareholders," Louis de Gabriele, BoV’s legal assistant lawyer said.

The Torre Annunziata court was judged to have had the jurisdiction to hear the case last April. 

Read: Shareholders agree BOV share capital increase

However, Mr Scerri had told concerned shareholders at an EGM last July that the case had not even started being heard and the April decision was only one linked to jurisdiction.

He insisted the bank had legal advice from its Italian lawyers telling it that BOV was not legally liable.

News of the court decision, which is subject to appeal, was broken by Italian news portal TorreChannel.it.  


2005: BoV embarked on its trust business.

December 2009: the bank took over the trust of Deiulemar, a company of merchant vessels. Its ships were valued €363 million when the company was put in a trust.

2012: Deiulemar was declared bankrupt. In November 2012, the bank resigned as trustee of Deiulemar.

2014: The curator started a case against the bank for €363 million.


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