Iranian investors seeking to open up bank accounts in Malta are being turned away, Finance Minister Edward Scicluna said today.

Asked about the reason behind this, and whether the Panama Papers scandal had a role to play, Minister Scicluna said that this is in response to the financial crises which has been plaguing the west. Elaborating on this, he said the economic slump as a result of banks taking too much risk, widespread terrorism being funded through secretive jurisdictions, drugs and money laundering have all contributed to the current financial climate.

He explained that banks are fearful from being penalised by regulators, in the case that a client turns out to be using the bank accounts for any wrongdoing. 

“Igaming companies are struggling to open up bank accounts here because of a one per cent chance that the company is a bad apple. The actions of the leading banks effects the way the markets behave. This general crisis happened because banks took too many risks, and now we are in this situation. There are risks and there are risks: we are simply reflecting that the current climate is hurting Malta.”

Professor Scicluna said that investors coming from North Africa, the Middle East and Iran are all finding problems when trying to open up bank accounts in Malta.

"Iran is an enormous country that has now started to open its doors to the world," he said.

"However, Maltese banks are refusing to open accounts for people, simply because they are from Iran. We must ask ourselves whether we want foreign investment or not."

He revealed that Maltese banks are to hold a meeting with the Islamic Financial Services Board, so as to understand their concerns. 

His comments come in view of Prime Minister Joseph Muscat's recent critique that the banks should loosen their lending practices.

Professor Scicluna praised Maltese banks' conservative lending approach for saving Malta from the 2008 financial crisis, he warned that "the pendulum has now swung too far in the opposite direction".