Bank of Valletta today reported a 34.3 per cent drop in profitability to €42.1 million.

The Bank of Valletta Group recorded a profit before taxation of €64.4 million, compared to €98.9 million pre tax profit earned in the previous financial year, a decrease in profits of 35 per cent.

Whilst the retail and corporate businesses of the group continued to perform steadily, the uncertainty in the financial markets, particularly in the second half of the year resulted in an overall fair value charge in the financial markets book for the year of €24.9 million.

The results were also impacted by the charge of €15 million relating to the La Valette Multi Manager Property Fund settlement.

The BOV board of directors made acash offer of 75c per share to all investors in the fund last June, in a bona fide attempt to provide all concerned with an opportunity, if they so elected, to settle matters that were in dispute.

By the closing date, investors in the fund, representing 97 per cent of the outstanding shares and shareholders, had accepted the offer and transferred their shares in the fund (together with all rights attaching thereto) to the bank.

This acceptance rate has since increased to close to 99 per cent, as a result of a number of transactions entered into subsequent to June 30, the bank said.

The bank said that the fund saga has been "a most unhappy and unfortunate experience" for Bankof Valletta and its customers and the offer had been directed at bringing the episode to an early conclusion.

The bank said that although a number of regulatory issues remained to be addressed in connection with the fund, BOV will work to bring early closure to all material issues relating to it, including the winding up thereof.

In its financial statements for the year ended September 30, the bank proposed the payment of a final gross dividend of 8c per share making for a final net dividend of 5c2 per share which would make for a total gross dividend for the year of 14c25 per share (total net dividend per share 9c2625.

The bank also proposed a bonus share issue of one share for every eight shares held to be allotted to shareholders on the bank's share register as at the close of business on January 12.

The bonus issue will be funded by a capitalisation of reserves amounting to €30 million.

The full results can be read in the pdf link below.