Bank of Valletta together with the Malta Development Bank and the Family Business Office have designed an innovative financing product to assist family businesses transfer their enterprise to the next generation. This initiative, a first for Malta, was announced by Mark Scicluna Bartoli, BOV executive, during the Malta Hotels and Restaurants Association's third quarter review and annual conference.
Tourism, being Malta's main source of income, requires strong local companies that are geared to meet the needs of this ever-growing sector. Most of these enterprises are family-run businesses which over time have developed into increasingly complex structures.
Scicluna Bartoli stated: "Bank of Valletta has a strong affinity towards Maltese family businesses since they have solid ties to their business and will back their company through the good and bad times. However, the bank's experience in engaging with family businesses has shown that over-dependency on one family member together with the lack of succession planning hinder the long-term sustainability of family businesses. Through this tailored product, which offers a favourable interest rate and collateral terms, Bank of Valletta will assist family businesses in financing the passing on of their business to the next generation. Our Relationship managers can direct the family business to undertake a succession plan so as to safeguard continuity and assist the business with the necessary financing to fulfil succession objectives."
The BOV Family Business Transfer Loan is to be launched during the first quarter of 2019. Bank of Valletta, in conjunction with MHRA, will be organising workshops during the coming year to provide further information on this initiative.
In the meantime, information about succession planning of family businesses through ownership transfer can be obtained from BOV SME Finance Unit at [email protected] or on 2275 1529. Information about registering under the Family Business Act and other initiatives for family businesses can be found at www.familybusiness.org.mt