Finance, the Economy and Investment Minister Tonio Fenech has been monitoring developments on the national and international financial markets, and is in regular contact with the Central Bank of Malta (CBM) and the Malta Financial Services Authority (MFSA), as well as with his international counterparts and leading executives from the financial services sector in Malta.

In a statement, the Department of Information said the minister is aware that both the MFSA and the CBM have assessed the exposures of Malta based financial institutions – in banking, insurance and investment services – to securities issued by Lehman Brothers Holdings Inc. and its subsidiaries, and the conclusion is that the impact on Malta of the Lehman collapse is minimal and manageable. There is no indication whatsoever that Malta’s financial system is facing unusual circumstances in areas such as capital adequacy, liquidity or credit risk.

As required by the MFSA Listing Rules, the Bank of Valletta has already issued a company announcement regarding its holding of senior (non-subordinated) Lehman paper, stating clearly that “any ultimate loss that may arise from this holding will be modest in the context of the results of the bank for the current financial year to date.”

The minister is satisfied that Malta’s financial services laws are being respected and implemented, and that the known impact of turmoil in overseas markets and institutions is being properly assessed and managed. At a micro level, consumers of financial services should continue to be mindful of their rights to clear disclosure from financial intermediaries on how the current international scenario could impact their investments.