Credit Institutions

Offering both security and flexibility, Malta is increasingly being seen as an attractive alternative to other established European finance centres. A licence in Malta offers a wide range of profitable activities from commercial and corporate banking to wealth management.

Malta’s stable economy is one of the EU’s top performers, and due to its strategic location and vast network of double taxation treaties, the country provides good access to the markets of Europe, North Africa and the Middle East. Malta boasts a state-of-the-art telecoms infrastructure and a workforce with excellent IT skills, and the country’s legislation also allows for online-only banks. Increasing numbers of both expats and high-net-worth individuals are moving to Malta, bringing increased business to the country’s banks and with €13.5 billion in domestic deposits for a population of 421,000, the Maltese are extremely wealthy.

Retail Banking

Although HSBC and Bank of Valletta (BOV) account for almost 90 per cent of the pie for domestic retail banking, it has not stopped smaller international banks from operating in this sphere. A number of banking institutions have recognised the potential of Malta’s retail market and have successfully set up, serving both local and international clientele. Purchasing power and interest for property is strong, and Malta has a
high request for home loans. Real estate is considered a reliable and profitable investment, and the country has a property-owning culture with most people preferring to buy rather than rent.

Business Banking

Malta’s financial centre is ever expanding and is witnessing around 25 per cent annual growth despite the global financial and economic crisis. With more than 65,000 companies – many of them foreign-owned – registered in the country, sophisticated business banking solutions and services are in high demand in the Maltese market. Growth in the fund and insurance sectors in addition to the high number of trusts that are established in Malta have created opportunities for the sector to expand, despite the limitations of a small domestic market.

Corporate Banking

Malta hosts a number of institutions specialising in trade-related products, such as structured trade finance, factoring and forfaiting. Malta’s strategic location and stable environment makes the country an ideal operational base and a launch pad to international markets. Regional emerging economies currently have a high demand for substantial infrastructure developments leading to opportunities in infrastructure and project finance through Malta’s attractive framework. Salaries and ongoing operational costs in Malta are around 20-30 per cent lower than those in other European countries and a wide range of high-quality office space and housing are available at reasonable rents.

Investment Banking

The fund sector is booming in Malta with almost 600 investment funds authorised by the MFSA in 2014, including an additional 27 fund administrators. These healthy numbers prove investment banking in Malta is an increasingly profitable business. With new applications flowing in to the MFSA, Malta is beginning to see a cluster forming for smaller international banks offering custody services. The Malta Stock Exchange is also gaining a reputation as a gateway for small-cap and non- European issuers to tap into the wider EU capital market.

Private Banking

Malta has become a hub for wealth management and family offices from Europe, North Africa and the Middle East. With the growth of the finance centre and other sectors of the economy such as shipping and aviation, a large number of affluent foreigners have relocated to Malta. Interest earned by non-residents on deposits placed with local banking institutions are exempt from any form of taxation and there is no exit tax on either the capital, or the income generated. Specialist wealth managers such as Mediterranean Bank are offering Swiss-style private wealth management, while foreign banks such as Sparkasse and BAWAG offer management solutions. Significant wealth growth is expected in emerging markets across the Mediterranean and North Africa, which can be easily accessed from Malta.
 

 

Download your copy of the Credit Institutions Factsheet