Fitch Ratings has upgraded Bank of Valletta’s Long-Term Issuer Default Rating (IDR) to ‘BBB’ from ‘BBB-‘ and the Viability Rating (VR) to ‘BBB’ from ‘BBB-‘. The Outlook on the Long-Term IDR is Stable. Fitch has also assigned BOV a long-term deposit rating of ‘BBB+’ and short-term deposit rating of ‘F2’.
This upgrade was announced by Fitch on Tuesday 25th March, in a statement that acknowledged “BOV’s dominant domestic franchise, which has allowed the Bank to consistently capture the profitable business opportunities offered by Malta’s benign operating environment, while maintaining adequate asset quality and capitalisation”.
Both BOV Chairman Dr Gordon Cordina and CEO Kenneth Farrugia expressed their extreme satisfaction on this announcement. Dr Cordina stated, “This upgrade by Fitch is another acknowledgement of the transformation journey that we’ve been on for the past years and is a testament to our dedication to sustain the Bank’s positive performance. This announcement enables us to look to the future with confidence and continue in our efforts to positively impact our stakeholders, shareholders and the wider community.”
CEO Kenneth Farrugia echoed the Chairman’s statement and commented, “This upgrade by Fitch Ratings is a substantial milestone for Bank of Valletta, reflecting our robust financial position and strategic vision. It follows a series of prestigious accolades we received in 2024, including an upgrade of our credit rating by Standard & Poor’s, the esteemed FHRD HR Quality Mark, two awards at the Malta Business Awards, and being named Company of the Year 2024 by the Malta Stock Exchange. These recognitions, culminating in Fitch’s upgrade, validate our sustained efforts and dedication to maintaining the Bank’s positive performance and supporting the growth of our business for the years to come.”
In the official statement, Fitch continued by saying that BOV’s ratings reflect its leading domestic franchise, which contributes to the bank’s sound earnings generation despite limited business diversification, but also its small scale and concentrated operations in a small economy. BOV’s lending standards and investment guidelines are in line with global industry practices, and its risk framework has strengthened in line with regulatory expectations.
The full report on Bank of Valletta’s upgrade can be viewed here.
Following last Tuesday’s Annual General Meeting and subsequent voting process, The Malta Chamber of Commerce, Enterprise and Industry Members elected a new council for 2025-2027.
The elected members, who also form the Economic Group executive boards are as follows:
Profit Before Tax of €302.4 million and Gross Dividend Payout of €130.7 million
Bank of Valletta achieved a record performance for financial year 2024, with profit before tax of €302.4 million, representing a growth of 20.2% when compared to FY2023. This was announced during a press conference hosted by BOV Chairperson Dr Gordon Cordina, CEO Kenneth Farrugia and CFO Kevin Cardona. The main highlights can be summarised in the following points:
Profit before Tax: Profit before tax for FY2024 amounted to €302.4 million, up from €251.6 million in 2023, reflecting a 10.1% increase in operating revenues and contained cost growth.
Dividend: The Board of Directors will be recommending a final gross dividend of €0.1314 per share, bringing the total dividend for FY2024 to €0.2238 per share, up by 92.5% from the 2023 level; this equates to a distribution of €76.7 million from H2 profits (€49.9 million net). Combined with the interim distribution, the total gross dividend payout amounts to €130.7 million (€84.9 million net).
Bonus Issue: The Board will also recommend a bonus share issue of one (1) share for every ten (10) shares held. This is subject to regulatory approval.
Share Buy-Back: The Board will be proposing a share-buyback initiative to increase the liquidity of the Bank’s equity instrument in the market, without cancelling shares. This is subject to regulatory approval.
Bond Issue: The Board will also be considering a further issuance of Bonds (Tranche 2) out of the Euro Medium Term Bond (EMTB) programme of up to €250 million.
Balance Sheet Growth: The Bank’s balance sheet expanded to €15 billion (67.1% of GDP, and 107% that of all other domestically oriented institutions taken together), while credit grew by €700 million during the year, with the Bank’s interest rates remaining among the lowest in the euro area.
FY 2024
FY 2023
Change
Profit Before Tax
€ 302.4 m
€ 251.6 m
+ € 50.8 m
Proposed Gross Dividend
€ 130.7 m
€ 67.8 m
+ € 62.9 m
Proposed Gross Dividend per Share
€ 0.2238
€ 0.1162
+ € 0.1076
Proposed Payout Ratio
42.6%
26.3%
+ 16.3%
Performance Highlights
The BOV Group’s performance was driven by a strategic focus on both revenue and cost management. Total operating income for FY2024 amounted to €485.8 million, marking a 10% increase from the previous year. This was driven by the expansion of loan portfolios, improved net fee and commission income, and a sustained treasury activity to continue investing in high quality financial instruments.
Net Interest Income: This increased by 9.6%, reaching €385.9 million, with the Bank expanding its lending activities and proprietary investments and benefitting from improved deposit rates on cash reserves. The growth in Net Interest Income was spearheaded by a dynamic balance sheet optimisation approach undertaken during the last years, where liquid assets were diverted into interest bearing investments with a view of stabilising income over a longer period and reducing volatility.
Net Fee and Commission Income: The BOV Group equally managed to register a 4.3% year on year growth over 2024, as this rose to €81.4 million.
Associates: The Group’s share of profit from insurance associates resulted in a profit of €9.5 million (€11.0 million in 2023).
Costs: Total Costs for the year amounted to €216.7 million which is 2.8% above the previous year. Personnel costs remained the primary cost driver, where the Bank continues to invest in talent followed by technology-related expenses where the Bank continues to invest as part of its strategic drive for digitalisation. The Bank has set out a cost management framework, encompassing a procurement excellence methodology, to ensure that cost levels are optimised over the medium to longer term both on the operational front, and on human resources, where a capacity planning exercise is currently underway.
Expected Credit Losses: The movement on Expected Credit Losses (‘ECL’) for the year amounted to a net release of €23.8 million (2023: €10.5 million net release), which was influenced by an improvement in both the non-performing and under-performing ratios as well as strengthened collateral position on a number of key non-performing assets. The Group’s unwavering commitment to improve the quality of the portfolio resulted in the non-performing loans ratio to continue heading downwards and closing at 2.68% which is equivalent to a 0.38% below the 3.06% outstanding as at December 2023.
Customer Deposits: BOV Group deposits increased by €651.7 million to €12.8 billion, driven both by non-personal and personal deposits. This was productively deployed in long-term interest-bearing assets with the credit portfolio increasing by more than €700 million and the investments portfolio up by €983.2 million.
Loans and Advances to Customers: Net loans and advances increased by 11.6% to €6.9 billion at end 2024, with the credit portfolio showing consistent growth primarily due to sustained business across all segments including business, home and personal loans, whilst also maintaining a strong focus on credit quality. As a result, the Gross Loan-to-Deposit ratio increased by nearly 3% by year end to 54.5%, and the Group’s liquidity remains well-above the minimum regulatory requirements.
Key Financial and Regulatory Ratios
FY 2024
FY 2023
Change
Return on average equity ratio
22.6%
21.1%
+ 1.5%
Earnings per share
34.2 euro cents
28.8 euro cents
+ 5.4 euro cents
Net asset value per share
€2.41 per share
€2.17 per share
+ €0.24 per share
CET 1 Ratio
22.31%
22.66%
– 0.35%
Total capital ratios
27.13%
25.94%
+ 1.19%
BOV’s impressive results are the fruit of years of transformation – Dr Gordon Cordina
Dr Gordon Cordina reflected on the results achieved by the BOV Group in 2024 as it celebrated 50 years of service to the community and the Maltese economy. “Bank of Valletta’s impressive results are the fruit of years of transformation that saw the Bank resolve legacy challenges and exploit new opportunities amid complex external dynamics on the regulatory, financial, economic and technological fronts. We continue to focus our efforts on delivering shareholder value, driven by prudent capital management as well as strategic and sustainable initiatives. The dividend we are announcing today, which is by far one of the strongest dividend payouts ever, as well as the bonus share issue, which is subject to regulatory approval, are a just reward to our trusted shareholders and reflects our dedication to maintaining a secure and profitable institution.
In the coming months, the Bank will also continue to focus on community and environmental issues. We have already made important strides in this regard, both in the way we operate by significantly reducing our carbon emissions, and by being more demanding on our customers to drive the green agenda. Our ESG and CSR initiatives will become even more pronounced in 2025 and will lead us on the sustainable path we have embarked upon.”
2024 was yet another outstanding year for the Bank – CEO Kenneth Farrugia
CEO Kenneth Farrugia echoed Dr Cordina’s comments on the BOV Group’s robust financial performance. “Building on the record performance achieved in 2023, I am pleased to announce that 2024 was yet another outstanding year of strategic growth and accolades for the Bank as we continue taking forward various key strategic initiatives carried in our Strategic Plan for 2024-2026. Our elevated customer focus, drive to deliver operational efficiency and the dynamic management of risks associated with our operations have all led to improvements in profitability across key business and operational segments. Notable growth was registered in the core credit financing and investments lines of business. The Bank will be pursuing further growth through new opportunities in bancassurance and voluntary occupational schemes, leveraging on the strong partnership with MAPFRE.
This year we continued to invest in our human capital and have implemented various initiatives to support the wellbeing of our employees. These actions have contributed to support our business and operational projects which centred on modernising our service channels, simplifying processes for better efficiency and strengthening risk controls. Over the course of this year, we also continued to strengthen our customer service experience as evidenced by the surveys carried out every month and also launched innovative products and services to our esteemed personal and business customers.
Standard & Poor’s Global Ratings recognised the Bank’s various initiatives and results achieved so far by raising the Bank’s credit rating to BBB. Another notable achievement in 2024 was the launch of the €100 million 5% unsecured subordinated bond, which was significantly oversubscribed on the first day of its launch, reflecting the trust and confidence placed in the Bank by the public and local and foreign institutions. At the end of 2024, the Bank was also awarded ‘Company of the Year’ by the Malta Stock Exchange as a reflection of the Bank’s achievements, and BOV Fund Services was voted as Best Fund Administrator in Malta 2024 by Capital Finance International reflecting our focus on service excellence.”
Corporate Social Responsibility and ESG
Mr Farrugia went on to say that “Sustainability remains firmly embedded in both our business and operational model. During this year, the Bank launched the BOV Foundation, reflecting the importance that we attribute to the Bank’s deep roots in many aspects of Maltese society where the communities that we operate in remain important stakeholders for us.
Our drive in this area culminated with the launch of the Rebbiegħa CSR Initiative, which secured Gold under the Project Green category during the Malta Business Awards. This initiative highlights BOV’s leadership as an active citizen in promoting sustainability. Our activities in support of our communities continued unabated and were equally recognised with the Silver Social Impact Award during the Awards event following the launch of BOV’s Volunteering Initiative. Since its launch, Bank employees supported various NGOs by participating in tree planting, clean-ups, and activities supporting vulnerable groups, including assisting children in care and animal shelters. On the ESG front, the Bank launched an innovative ‘green’ credit financing product for SMEs to support the country’s transition to a more sustainable future.”
Both the Chairperson and CEO underscored the paramount importance of the Bank’s dedicated employees in achieving these record financial results. They praised the unwavering commitment, exceptional talent, and relentless efforts of the entire team, which has been instrumental in driving the Bank’s success. The Board of Directors’ ongoing guidance and support, combined with the strong loyalty and trust of the Bank’s esteemed customers, were also recognised as pivotal factors in this remarkable performance.
The Malta Chamber of Commerce, Enterprise and Industry held its Annual General Meeting (AGM) on Tuesday 25th March 2025. This AGM saw the end of a two-year term of office of President Chris Vassallo Cesareo while initiating The Malta Chamber Council elections to elect the Council members that will serve for the 2025-2027 term.
“Throughout my tenure, The Malta Chamber has maintained consistent engagement with key stakeholders, government entities, authorities, agencies and other experts whose decisions impact businesses. We have also constantly engaged with other employer bodies and social partners, as well other associations to streamline policy efforts. Our aim is to ensure that our policy positions are clearly understood and considered and are placed on the national agenda. It is imperative that we continue striving for political consensus that prioritises quality over quantity, works towards higher productivity levels, increased transparency and better governance in the day-to-day running of the country,” noted outgoing President of The Malta Chamber, Chris Vassallo Cesareo.
Before the AGM, Fredrik Persson, President of BusinessEurope, addressed the attendees. “If you have the right people, commitment, and leadership, you can pitch effectively and create a meaningful impact in Brussels. The challenges of insularity foster creativity and agility, and you can be confident that the work of The Malta Chamber is making a significant difference, shaping European policy, and driving real change,” he emphasised.
Dr Marthese Portelli, CEO of The Malta Chamber, reflected on the achievements of the past year, outlining key policy initiatives, projects, communication efforts, and events. She also highlighted upcoming plans and priorities. “In the year ahead, our focus will be to continue enhancing quality and delivering greater value to our members. This will be supported by continued policy advocacy with government entities and strengthened collaboration with European and international partners,” stated Dr Portelli.
As the AGM drew to a close, Donald Schembri, Partner at RSM Malta, delivered the financial reports for the fiscal year 2024.
As Bank of Valletta concludes a year of celebrations marking its 50th anniversary, it is reinforcing its commitment to the community with the launch of Inħawlu Tbissima, an initiative focused on mental health awareness and environmental sustainability, thanks to the collaboration with Richmond Foundation and ACT Malta.
Supporting Mental Health Awareness
Recognising the importance of mental well-being, BOV is strengthening its collaboration with Richmond Foundation to provide valuable resources and raise awareness about mental health. Through this initiative, the Bank aims to encourage open conversations and ensure that those in need know where to seek help. Just as a strong root system supports a flourishing plant, mental resilience is essential for a healthy, thriving individual and community.
Promoting Environmental Sustainability
In partnership with ACT Malta, BOV is also advocating for environmental sustainability by educating the public on the significance of planting and preserving endemic species. As part of the initiative, BOV volunteers visited various locations across Malta and Gozo, distributing seed pouches of the Sicilian Silver Ragwort (Kromb il-Baħar) – a resilient native plant that symbolises endurance, renewal, and growth. Just like this plant thrives in local conditions, Inħawlu Tbissima encourages individuals to nurture both their well-being and their surroundings, creating a healthier, more sustainable future.
Ernest Agius, COO at BOV, commented “BOV is committed to making a positive impact beyond banking. Inħawlu Tbissima embodies the values of care and growth – supporting mental well-being while encouraging environmental responsibility. The Sicilian Silver Ragwort, with its resilience and beauty, reflects the essence of this campaign, reminding us all that small actions can lead to lasting positive change. As the Bank concludes its milestone 50th-anniversary celebrations, it remains dedicated to initiatives that strengthen both the community and a more sustainable future.”
Charles Azzopardi, Head CSR at Bank of Valletta added, “This initiative is a call to action for everyone to play a part in building a healthier, greener future. Whether it’s taking a moment to priortise mental well-being or planting a seed for a better environment, Inħawlu Tbissima is about collective effort and positive impact. The Sicilian Silver Ragwort is the perfect symbol for this campaign – just like it adapts and flourishes, so too can our community when we nurture it with care and commitment.”
BOV invites the public to engage with this campaign by spreading awareness and taking small steps toward a healthier mind and environment. For updates and further information, one may follow Bank of Valletta’s social media channels.
On International Women’s Day, HSBC Malta Foundation marked its ongoing commitment to helping women in need by contributing through its annual donation drive. This initiative, which has become a cornerstone of the bank’s social impact efforts, provides essential items to women affected by domestic violence, mental health challenges, homelessness, and other adversities.
This year, HSBC Malta, in collaboration with a local school and the generous support of suppliers, has once again brought the community together to gather vital supplies for 23 NGOs working to assist vulnerable women. Donations include essential toiletries such as shampoo, shower gel, toothpaste, and deodorants, along with much-needed items like blankets and food supplies. These contributions will help ease the burden on women facing hardship and ensure they have access to basic necessities.
Students participating in this initiative demonstrated a strong sense of responsibility and community spirit. Many were involved in collecting and organising the donations, highlighting the importance of instilling values of compassion and solidarity in younger generations.
The donations were presented at a special event at HSBC’s Head Office in Valletta, where, for a day, the boardroom was transformed into a space of generosity and goodwill. This mirrored the success of previous donation drives and reinforced the bank’s dedication to social responsibility.
Melanie Piscopo speaking on behalf of St Jean Antide Foundation emphasised the impact of such initiatives: “Acts of kindness, no matter how small, can have a profound effect. This initiative is a testament to the strength of community and the power of collective action to bring positive change to those who need it most. It is heartening to see so many people come together with a shared purpose – to support and uplift women facing hardship.”
Glenn Bugeja at HSBC Malta, reflected on the bank’s long-standing commitment to supporting the community: “At HSBC Malta, we believe in creating meaningful change, and this donation drive is just one of the ways we give back. Supporting women in need is not just about providing essential items; it’s about sending a message of solidarity, respect, and hope. Seeing students, schools, and suppliers unite for this cause is incredibly inspiring, and we are grateful to everyone who contributed.”
The HSBC Malta Foundation remains committed to empowering individuals and fostering a more inclusive society. By working closely with local organisations and the wider community, the foundation continues to champion initiatives that make a real difference in people’s lives. Through efforts like this annual donation drive, HSBC Malta strengthens its role as a force for positive change, ensuring that those in need receive both material support and the reassurance that they are not alone.
On World Down Syndrome Day, Bank of Valletta is proud to highlight the achievements of four employees with Down Syndrome who make valuable contributions to the Bank every day and have now become an integral part of the BOV family. Their dedication, hard work, and enthusiasm exemplify the Bank’s strong commitment to promoting inclusion at the workplace.
Today, we celebrate Christian Zammit, Maria Pia Saliba, Charline Magro, and Alec Falzon.
Christian Zammit was the first employee with Down Syndrome to join the bank—23 years ago. As a member of the Learning and Development Section, he provides support to his colleagues with a variety of tasks. “I manage the rooms (of the Learning & Development Centre), handle photocopying, binding, and more. I’ve built strong friendships here and love to share a laugh with my coworkers,” Christian shared. In his colleagues’ words, Christian has made significant contributions to the Bank and to their personal growth, more than they have given him in return.
Maria Pia Saliba has been a valuable member of the Bank for seven years, contributing to the Customer Onboarding Unit. She asserts, “I am very pleased to work here. I love all the staff, and I am treated with respect by everyone. I enjoy working with them; I have found my second family here.”
Charline Magro works in the E-Banking section, where she assists her colleagues with tasks such as shredding documents, and she often delights them with sweet treats. “They all look forward to the biscuits,” she remarked. In addition to her work at BOV, Charline is actively involved in sports and has a passion for modelling. Proudly displaying her trophies, she shared that her most recent award was presented by the Fgura Local Council in recognition of her voluntary contributions to the community.
Alec Falzon joined the Personal Banking Channels Department two years ago. His colleagues describe him as energetic and hardworking, noting that he makes a positive difference in the workplace. He is an example of how his abilities and love for sports encourage others to improve their lives. Alec is also an athlete and was recently honoured with the Special Olympics Male Award during the 65th edition of the Għażliet Sportivi Nazzjonali, which took place earlier this month.
Ray Debattista, responsible for the Bank’s People and Culture function at Bank of Valletta, noted that “Bank of Valletta is one of the most welcoming companies for individuals with diverse needs. We focus on the person, rather than just their specific issues, because we believe everyone deserves the opportunity to feel included in society.” He urged other companies to follow the Bank’s example, highlighting that the contributions of people like Christian, Maria Pia, Charline, and Alec are more significant than they may realise.
On this occasion, employees at Bank of Valletta were invited to wear odd socks and take team photos.
World Down Syndrome Day is observed annually on 21 March, to raise awareness about Down Syndrome. Officially recognised by the United Nations since 2012, this day encourages understanding and support for individuals with Down Syndrome. The date symbolises the triplication (trisomy) of the 21st chromosome, which causes Down Syndrome.
The Malta Chamber of Commerce, Enterprise and Industry and the National Skills Council (NSC) have signed a Memorandum of Understanding (MoU) to strengthen collaboration on labour market intelligence (LMI). This strategic partnership aims to enhance the analysis of employment trends, skills demand, and workforce dynamics in Malta, with the ultimate goal of fostering economic growth and addressing skills shortages.
Through this MoU, the NSC and The Malta Chamber will cooperate on the use of LMI to gain a deeper understanding of job market dynamics. The insights gathered will support the development of government policies in areas such as employment, incentives, training, curricula, and other critical sectors. This data-driven approach will help address challenges related to human resources, skills gaps, and industry expertise shortages.
A key objective of this collaboration is the creation of a live local vacancy monitor, building upon insights from a pilot study conducted by RSM Malta and The Malta Chamber. This tool will provide a comprehensive time-series analysis, tracking fluctuations in job vacancies across various industries, job types, and other relevant categories. By leveraging this information, stakeholders will gain a clearer picture of labour market movements, supporting better workforce planning and economic decision-making.
The scope of the MoU extends beyond conceptualising a labour market intelligence framework. The agreement establishes a commitment to develop and maintain a fully functional LMI system that is not only designed but also operational and accessible for use by both The Malta Chamber and the NSC. This initiative will ensure real-time and strategic workforce planning, benefiting businesses, policymakers, and job seekers alike.
Commenting on the signing, Chris Vassallo Cesareo, President of The Malta Chamber, stated: “This partnership is a significant step towards bridging the gap between market needs and workforce skills. By utilising real-time labour market insights, we can drive policies and initiatives that better support businesses and employees in Malta.”
“The signing of this MoU marks an essential step in enhancing Malta’s workforce planning capabilities. We can proactively address skills shortages to the evolving demands of industry. Through this collaboration, we are reinforcing our commitment to a data-driven approach that benefits businesses, employees, and Malta’s economy,” noted Dr Jeffrey Pullicino Orlando, Executive Chair of the National Skills Council.
This MoU underscores the shared commitment of The Malta Chamber and the NSC to leveraging data-driven insights for economic and workforce development. By fostering a deeper understanding of Malta’s labour market trends, the initiative will help ensure that skills development and employment policies remain aligned with industry needs, promoting sustainable economic growth.
