Author: Mel Chamber

Bank of Valletta announced its support towards Marsa Holy Trinity Church in a significant restoration project involving four iconic paintings by the renowned Maltese artist Gianni Vella. These monumental works, dating back to 1912, are now being carefully restored to their original glory.

The four paintings, each measuring an impressive 2.25 metres by 4 metres, are located in the choir of the Holy Trinity Church and represent Vella’s early ecclesiastical phase. The artworks being restored include St John baptising Christ in the River Jordan, Abraham Genuflecting in front of the three Angelic Visitors, The Sending of the First Apostles, and God Breathing Life into Adam.

These paintings showcase Vella’s mastery of translucent glazes, a technique that characterized his early work before he transitioned to a bolder, impasto style influenced by Italian Macchiaioli artists. Rather than drawing influence from Cali, Pisani or Palombi, Vella’s work comes closer to that of Silvio Galimberti and Francesco Grandi.

The conservation work, undertaken by Pierre Bugeja of Prevarti Co Ltd, has already seen the successful completion of two of the works of art, The Sending of the First Apostles and God Breathing Life into Adam, now returned to their pride of place within the Church.

Ernest Agius, Chief Operations Officer, accompanied by Charles Azzopardi, Head CSR & Events, visited the Church on the day that the works of art were reinstalled in their original locations within the church. They were given a warm welcome by Father Dominic Mangani, Parish Priest of Marsa Holy Trinity Church.

Ernest Agius, expressed his enthusiasm, stating, “It’s truly inspiring to see these historic artworks restored to their former beauty. This project is a testament to our commitment to preserving Malta’s rich cultural heritage, and it is truly an honour to play a part in ensuring the longevity of these masterpieces so that they can be enjoyed by future generations.”

Charles Azzopardi also commented on the significance of the restoration. “Our collaboration with Marsa Holy Trinity Church reflects our dedication to supporting the arts and the community. By restoring these paintings, we are not only preserving important works of art but also contributing to the cultural and spiritual fabric of Malta.”

Expressing his gratitude for the Bank’s support, Father Dominic Mangani expressed his gratitude for the restoration efforts. “These paintings are integral to the history and identity of our Church and our community. The restoration has revived their spiritual essence, and we are deeply thankful to the Bank for their support in preserving this invaluable part of our heritage.”

The remaining two paintings, St John Baptising Christ in the River Jordan and Abraham Genuflecting in Front of the Three Angelic Visitors, are currently undergoing restoration and are expected to be completed in the coming months.

Bank of Valletta continues to invest in the professional growth of its employees, reinforcing its commitment to excellence in the financial industry. As part of this effort, BOV Asset Management sent four of its Financial Advisors to London for an exclusive two-day training program at Insight Investment Management (Global) Limited and Fidelity International. This training initiative is part of the Bank’s ongoing efforts to support its employees’ professional development and ensure that they remain at the forefront of modern industry trends. As the official representative of Fidelity in Malta, BOV values this partnership and the opportunity it provides for advanced training and insights.

Fostering Expertise at Insight Investment Management

The training began with an in-depth session at Insight Investment Management. The BOV employees had the opportunity to meet Ms Cathy Braganza, Senior Credit Analyst of the Vilhena High Yield Fund, a firm favourite among local investors. Valuable insights were shared on the Fund’s current bullish stance, highlighting attractive yield levels and low default rates. The focus on companies with robust growth potential and stable cash flows provided the team with fresh perspectives on high-yield investment strategies.

Expanding Horizons at Fidelity International

The BOV representatives engaged in a series of presentations at Fidelity International’s offices. Ms Cornelia Furse, Portfolio Manager, delivered an insightful presentation on the Fidelity Sustainable Global Equity Fund, emphasizing the importance of sustainable investments aligned with the United Nations Sustainable Development Goals. The session served to highlight the Fund’s commitment to making a positive environmental and social impact while achieving strong financial performance. Ms Libby NcNie, Fixed Income Investment Specialist, provided an overview of the Fidelity Euro Corporate Bond Fund, detailing the rigorous in-house research and strategic analysis used to identify optimal investment opportunities in a fund that emphasises favourable Environmental, Social, and Governance (ESG) characteristics.

Commitment to Continuous Learning and Development

“At BOV, we believe in nurturing our talent and providing opportunities for continuous learning and growth,” explained Mark Agius, Head BOV Asset Management who accompanied the BOV team of employees. “BOV Asset Management remains dedicated to empowering its employees through regular, high-quality training programmes both locally and internationally. This initiative, which has become a staple appointment in our diaries, not only enhances our employees’ skills but also reinforces our commitment to excellence and innovation in the financial sector. By investing in its people, the Bank works towards fostering a culture of excellence that benefits its customers and the broader community.”

The Foundation for the Conservation of the Maltese Honeybee (KNM), in partnership with HSBC Malta Foundation, is proud to announce the release of a new A6 postcard promoting the National Insect Initiative. This initiative aims to raise awareness and support for the conservation of the endemic Maltese Honeybee.

The Maltese Honeybee (Apis mellifera ruttneri), a unique subspecies evolved in isolation on the Maltese Islands, faces significant threats due to hybridisation and the accidental introduction of the Varroa mite in 1992. Conservation efforts are critical to preserving this locally adapted subspecies from extinction.

The Maltese Honeybee is currently a candidate to be classified as a National Species, an initiative of the KNM Foundation. If successful, it would join only five other local species holding this prestigious status. The Foundation for the Conservation of the Maltese Honeybee (KNM) is dedicated to preserving the unique Maltese Honeybee through education, conservation, and advocacy.

Highlighting these efforts, the new postcard features the Maltese Honeybee on a flower of the indigenous Mediterranean Thistle (Galactites tomentosa) on the front, and on the endemic Maltese Pyramidal Orchid (Anacamptis pyramidalis urvilleana) on the back, drawn by local artist and architecture student Karl Farrugia. The postcard’s design integrates elements symbolic of Malta, including the white and red colours of the Maltese flag and a detail from the Maltese Cross. A QR code links to an educational video about the Maltese Honeybee, available at https://youtu.be/PYmKpkSzJTQ.

This postcard, sponsored by HSBC Malta Foundation, will be available at HSBC branches across Malta and Gozo starting this August, with additional copies distributed in schools at the beginning of the new academic year in September.

Glenn Bugeja, on behalf of HSBC Malta Foundation said, “We are proud to support the call for the Maltese Honeybee to be declared the National Insect of Malta. We firmly believe that this elevated status would help raise awareness about this special pollinator, leading to better conservation efforts.”

Dylan Farrugia, President of the KNM Foundation, added, “As the initiative to declare the Maltese Honeybee continues to gather traction, we are proud to once again partner with HSBC Malta Foundation, who have generously renewed their support for our cause.”.

BNF Bank today announced its financial results for the first half of 2024, showcasing a solid financial performance and continued strategic investment in technological advancements. Despite the competitive financial landscape, the Bank has demonstrated resilience and adaptability, achieving a profit before tax of €6.3 million.

BNF Bank’s Chief Financial Officer, Mark Micallef, expressed confidence in the Bank’s ongoing progress, highlighting the significant yet manageable investments in digital transformation. He commended the Bank’s achievements in the first half of the year, including the successful implementation of digital customer onboarding and the opening of a new branch at the Campus Hub. Micallef assured customers that they can anticipate further enhancements in the coming months. He emphasized the Bank’s commitment to its core philosophy: BNF Bank’s success is driven by keeping customers at the forefront of everything it does.

Key Highlights of H1 2024:

Profit Before Tax:

€6.3 million, underpinned by robust core revenue streams.

Total Net Operating Income:

Increased to €18.5 million from €18.1 million in June 2023, driven by net interest income alongside net fees, commission income, and gains from net trading and investments.

Investment in Technology:

Operating expenses rose to €12.5 million, reflecting the Bank’s strategic investments in technology to drive digital transformation and enhance customer experiences.

Reduction in Credit Losses:

A reversal of expected credit losses amounting to €0.4 million highlights the Bank’s commitment to maintaining a prudent approach to credit risk management.

Profit After Tax:

€4.3 million, compared to €5.0 million for the first 6 months of 2023.

Strong Financial Position:

As of 30 June 2024, BNF Bank’s total assets grew to €1,277.8 million, compared to €1,236.4 million in December 2023. Loans and advances to customers also increased, reaching €975.2 million from €950.3 million in December 2023. The percentage of credit-impaired loans decreased to 2.5%, underscoring the Bank’s robust credit management practices.

The Bank’s commitment to maintaining a strong liquidity position is evident, with the Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR) remaining well above regulatory requirements at 195.6% and 138.1%, respectively. The Bank’s Capital Adequacy Ratio stood at 17.4%, well above regulatory requirements and supporting a solid foundation for future growth.

Continued Growth and Innovation:

BNF Bank remains focused on leveraging its strategic investments to deliver innovative solutions and enhance customer service. The Bank’s ongoing commitment to technology and operational excellence positions it well to capture new opportunities and drive sustainable growth.

The Bank’s Condensed Interim Financial Statements for the six-month period ended 30 June 2024 can be accessed online on the Bank’s website.

Bank of Valletta’s first Financial Well-Being Centre officially opened its doors last week, marking a significant milestone in the local financial services sector. The opening was attended by the Bank’s Chairman Dr Gordon Cordina, CEO Kenneth Farrugia, Chief Personal and Wealth Officer Simon Azzopardi and Chief Operations Officer Ernest Agius.

The Financial Well-Being Centre, located in St Anne Street Floriana, offers a comprehensive service to both personal and business customers. Services offered include financial planning and budgeting, lending, investments and retirement planning. The service is offered specifically through appointments with dedicated relationship managers or other specialised employees who are experts in their field, offering one-to-one personal meetings in a private space to ensure full client privacy and confidence. Customers will be served at their convenience by the same persons who assist them at their branch; they can also request other experts for specific services.

In his opening address, Kenneth Farrugia, BOV CEO expressed his satisfaction at the Bank’s progress in taking customer experience to the next level. “We are truly pleased to open the Bank’s Financial Well-Being Centre in Floriana,” he said. “This is both a first for BOV and a first for the Maltese islands, in line with our mission to empower individuals with the knowledge and tools they need to make sound and informed financial decisions. This new Centre represents a crucial step forward in our customer-centric driven strategy as we focus on taking a holistic approach to the Bank’s service experience.”

Simon Azzopardi, Chief Personal and Wealth Officer continued to expand on the Centre’s holistic approach to customer service. “Our Centre is specifically designed to offer a wide spectrum of services that encompass all that our customers may need at every stage of their financial journey. We truly believe in the financial wellbeing of our customers and this personalised, one-on-one approach will ensure that our clients receive expert advice that will truly help them meet their financial objectives.”

Dr Gordon Cordina, BOV Chairman highlighted the strategic importance of the Centre. “The establishing of this Centre underscores the Bank’s commitment to fostering financial resilience in today’s society. We are intrinsically linked to the Maltese economy and in our 50-year history have been present in the lives of the majority of Maltese. The Bank is ensuring that its physical presence in localities around Malta and Gozo is cemented not only by the traditional branch, but also by other more innovative outlets, making the Bank even more relevant today. This Centre reinforces our aspirations to continue to be leaders and innovators in the financial sector and a catalyst for positive change.”

Customers wishing to discuss their financial circumstances with our team at the new BOV Financial Well-Being Centre can apply online for appointments. Alternatively, they may scan the QR Code available outside the Centre itself to access the booking application on bov.com.

HSBC Bank Malta reported record half year profits reflecting revenue growth, investment in people and technology as well as strong credit quality of the loan book. A record profit performance of €78.6m in the first half of the year has enabled us to continue the trend of rewarding our shareholders with the highest interim dividend over the last 10 years. The Directors are recommending a gross interim dividend of 10 cents per share.

Financial performance

• Profit before tax increased by €19.3m to €78.6m, mainly driven by an increase in revenue due to the higher interest rate environment and higher credit recovery which was partially offset by higher costs as the bank continued to invest.
• Revenue increased by €21.5m or 20% driven by rising interest rates and a 34% increase in trading income. Progress was also reported in net fee income and income from the insurance subsidiary.
• A release of €7.0m was reported on expected credit losses (‘ECL’) in view of curing of non-performing loans and releases of overlays held by the bank in relation to inflationary pressures.
• Costs are €6.6m higher than the same period in 2023. This increase was largely driven by the investment in people, technology as well as the new headquarters in Qormi, ‘HSBC Hub’.
• During the first six months, loans to customers and deposits were slightly lower than those reported at 31 December 2023.  
• Profit attributable to shareholders of €50.7m for the six months ended 30 June 2024 resulted in earnings per share of 14.1 cents which compared favourably with 10.7 cents in the same period in 2023.
• An interim gross dividend of 10 cents per share is being recommended.
• Return on equity of 18.3% for the six months ended 30 June 2024 compared favourably with 16.2% for the same period in 2023.
• Cost efficiency ratio (‘CER’) improved to 43.9% from 46.6% in the same period last year as the increase in revenue outweighed the increase in costs.
• The bank maintained a strong liquidity and capital position as at 30 June 2024, with a   Liquidity Coverage Ratio of 552% and Tier 1 Capital of 21.1%.

Financial performance

Profit before tax for the six months ended 30 June 2024 was €78.6m, an increase of €19.3m from the same period in 2023. Higher profits reflect an improvement in all revenue lines as well as a higher recovery of expected credit losses (‘ECL’). These positive variances were partially offset by higher costs as the bank continued to invest.

Net interest income (‘NII’) increased by €17.0m to €106.6m compared with €89.7m in the same period in 2023. The increase in NII was driven by the higher interest environment as the average interest rates in H1 2024 were higher than those prevailing in H1 2023.

Non-funds income (fees and commissions and trading income) increased by €1.3m reflecting a rise in both trading and new fee income. Trading income increased by 34% compared to the same period last year driven by higher foreign exchange income generated from the strong relationship with corporate customers.

Operating expenses increased by €6.6m to €56.1m, compared with €49.5m in the same period in 2023. While there were several contributors to the movement in operating expenses, the most material drivers were increases in staff costs, IT expenses and real estate costs as the bank continues to invest in its people, technology, and new headquarters in Qormi. Releases in litigation provisions reported in H1 2024 were roughly of the same value to a refund from insurance in relation to operational losses reported in 2023.

During the six months, there was a release of ECL of €7.0m, compared to a release of €2.6m reported in the same period last year. Both the retail and corporate business lines contributed to the release. The release in the corporate business line was mainly a result of amounts recovered from non-performing loans and an improvement in the credit quality. On the other hand, the release in the retail business was mainly driven by a release of provisions held for inflationary pressures which did not materialise.

HSBC Life Assurance (Malta) Ltd reported a profit of €4.5m compared to €1.6m reported in the same period last year. The increase in profits is a result of an improvement in the composition and volume of new business together with yield curve and positive movements on the financial securities’ prices.

The effective tax rate was 35% in both periods. This translated into an interim tax expense of €27.9m.

Financial Position and Capital

Net loans and advances to customers amounted to €2,981m, a decrease of €103m or 3% when compared to 31 December 2023. The bank continued to improve asset quality by reducing non-performing loans by 28% while retaining a prudent credit policy to ensure long term sustainability of its service proposition.

The bank’s investment portfolio increased by €394m to €1,710m as the bank invested in longer tenure assets to strategically hedge against future movements in interest rates. The investment portfolio is composed of highly rated securities and continues to be conservatively positioned with the lowest investment grade of A-.

Customer accounts were €6,058m as at 30 June 2024, a decrease of €83m or 1.4% compared to 31 December 2023. The bank had a satisfactory advances-to-deposits ratio of 49%, and its liquidity ratios were well in excess of regulatory requirements.

The bank continued to strengthen its capital ratios and is fully compliant with the regulatory capital requirements. The bank’s common equity tier 1 capital was 21.1% as at 30 June 2024, compared to 20.6% at the end of 2023. The total capital ratio increased to 24.1% compared to 23.5% as at 31 December 2023.

The bank continued its trend in rewarding its shareholders with the highest interim dividend over the last 10 years. The Board has thus recommended an interim gross dividend of 10 cents per share which amounts to a gross dividend of €36.0m. The interim dividend will be paid on 17 September 2024 to shareholders who are on the bank’s register of shareholders on 16 August 2024.

Geoffrey Fichte, the Chief Executive Officer of HSBC Malta, said:

“HSBC is celebrating 25 years in Malta. Our results for the first half of the year reflect the strong relationship with customers built over these years as part of Malta’s economic transformation, as well as the continued success of our turn-around strategy announced early last year. We’re growing revenue across all of our businesses and continue to invest for the long term. HSBC’s robust management of risk and focus on high-quality and long-term customer relationships continues to deliver results.

“This year we signed an ambitious and ground-breaking three-year collective agreement to energise our talent on customer service excellence. We inaugurated our new headquarters, HSBC Hub, in Qormi, a €30m investment in the future of work. We accelerated investments in technology, sustainability and new ATMs to support customers.

“We thank our customers and shareholders for their support and are recommending a gross interim dividend of 10 cents per share which is the highest dividend over the last 10 years. Our capital and liquidity remain strong, and we continue to pursue growth opportunities in Malta.”