The banking sector’s reticence when opening new accounts was in breach of EU rules, Prime Minister Joseph Muscat warned yesterday.

Speaking at the launch of the Malta Financial Services Authority’s Vision 2021, he said that though he appreciated the banks’ attempts to de-risk, he could not tolerate a situation where “legitimate” people and businesses could not open new accounts. He praised the MFSA recent campaign to remind entities that access to a basic bank account was a right they could insist on.

In line with a 2016 legal notice, banks having five or more branches in Malta must offer a payment account with basic features. The MFSA is now putting subtle pressure on the five banks that fall into this category – APS, BNF, Bank of Valletta, HSBC and Lombard – by telling people they had a right to open such an account. This also extended to people with no fixed address, refugees, stateless individuals and asylum seekers.

Since the MFSA warning, bank branches have started to clearly display posters and MFSA material explaining people's rights.

“Banks are not supposed to be just safety deposit boxes,” Dr Muscat scoffed, adding that Malta needed more banks to offer more alternatives and make the service more efficient.

Referring to criticism levelled at the financial services watchdog, the Prime Minister noted it was lambasted both for being too lax and for being too strict, “sometimes by the same people”. The government was convinced it was doing a good job and took appropriate action when necessary.