Bank of Valletta and Konrad Mizzi have so far failed to explain the purpose of an “odd” reference letter which Nexia BT used to open a trust in New Zealand and other financial vehicles in Panama.

Bank of Valletta’s letter of reference, signed by Albert Frendo.

The letter was described as “odd” by senior banking officials due to the way it was addressed and the office which issued it. The letter bears the logo of Bank of Valletta and is signed by Albert Frendo, the bank’s chief officer for corporate finance.

Beginning “To whom it may concern”, Mr Frendo wrote he had known Dr Mizzi, “in a professional capacity for approximately two years”. He added: “From my experience and knowledge of Dr Konrad Mizzi, I consider him to be a suitable person to satisfactorily operate a bank account.”

The letter, dated June 1, 2015, did not indicate that Dr Mizzi was a Cabinet minister and therefore a politically exposed person. In the banking world, a PEP is exposed internationally to a much more rigid due-diligence process than a normal client.

Observers noted it was difficult to understand how Dr Mizzi, who had never before declared any ownership of any business or commercial entity in Malta, had established a one-to-one professional relationship with the bank’s office responsible for corporate finance.

Questions to the bank on the relationship between Dr Mizzi and the bank’s division responsible for financing commercial companies and why it had failed to signal that its client was a PEP remained unanswered at the time of writing.

The bank’s CEO, Mario Mallia, told this newspaper it was not possible to comment on issues concerning individuals or entities. He suggested that, should the newspaper have an issue with the bank’s conduct, it should report the matter to the banking supervisory authorities.

Dr Mizzi failed to reply when asked if he had personally asked Mr Frendo for the letter and to declare his relationship with the bank’s corporate finance office.

On May 23, 2015, in an e-mail sent to Mossack Fonseca’s office in New Zealand, Nexia BT’s Karl Cini complained of the need for two bank reference letters, arguing “it is common to have just one”.

He told Mossack Fonseca that his clients, Dr Mizzi and Keith Schembri, the Prime Minister’s chief of staff, who was also arranging the same financial set up, “would like to avoid informing the banks here” on the opening of a trust in New Zealand.

The Panama Papers were made available to the Times of Malta through an investigative partnership with the International Consortium of Investigative Journalists and the German newspaper Suddeutsche Zeitung.