Bank of Valletta held its Annual General Meeting on Thursday, during which the highlights of last year’s performance were presented, together with the Bank’s objectives for the current financial year.
For the third year in a row, the Bank’s AGM had to be held virtually, in view of the fact that preparations were well on the way before the COVID-19 restrictions were lifted. Notwithstanding, the Bank is holding an information session and meeting shareholders in person in two weeks’ time.
Paving the way to a sustainable future – Dr Gordon Cordina
Addressing shareholders, Bank of Valletta Chairman Dr Gordon Cordina said that since the litigation case with Deiulemar's creditors was brought to a close, there has been a significant positive response on BOV’s share price, so much so that since the last Annual General Meeting, the price has risen by about 25%. He stressed that with the case now over, the main purpose of the Board is to pave the way for a stable dividend and return to stronger and more sustained levels of profitability.
This, according to Dr. Cordina, should lead the Bank to offer more modern services, while improving the cost-effectiveness of delivering its services to customers. Despite the challenges already overcome, the Chairman said that the Bank continues to enjoy strong and much-needed capital to continue to face new challenges. The successful implementation of the Bank’s strategy will be a key factor in this. The Chairman said that digitising processes, reorganising the balance sheet and improving the customer experience are key to generating long-term profitability.
Strong Financial Results despite the challenges – Mr Rick Hunkin
During his address, Bank of Valletta CEO Mr Rick Hunkin said that despite the challenges of 2021, the Bank registered a strong financial performance, as profits before tax exceeded the €80 million mark. He recalled that last year the Bank operated in a persistent pandemic environment, with sectors of the economy that were affected by market nervousness due to Malta’s grey-listing, and more recently in uncertainties brought about by geo-political instability derived from the war in Ukraine.
Mr Hunkin reiterated that a prevailing negative interest rate environment, which continues to prove punitive for the banking sector, continued to reduce Bank of Valletta's net interest margin. Despite this, Mr Hunkin stated that over the past year the Bank recorded an 11% increase over the previous year in total Assets, increasing its Investment portfolio by €260m and increased lending to its customers by almost 7% over the previous year.
A new face on the Board
Following an approval from the Board of Directors in December, the Bank sought shareholders’ approval and ratification to an interim dividend payment of €0.0264 per share which was paid in January. This represented a gross payment of over €15 million. With the uncertainties of the last few months however, the Board decided to adopt a cautious approach and hence did not feel it had to recommend the distribution of a final dividend for financial year 2021.
During the Meeting, shareholders voted on the re-appointment and remuneration of the Auditors, on the renewal of the Board’s authority to issue shares, on the Directors’ Remuneration Report, on the revised Remuneration Policy for Directors and on changes to the Bank’s .
No election for directors was held and James Grech and Deborah Schembri were automatically appointed on the Board. Deborah Schembri is a new Director on the Board, replacing Steve Agius who has not contested the post after more than five years in office. Her appointment is subject to regulatory approval and will become effective from date of such approval.