HSBC Malta has reported positive interim results, with CEO Alan Richards commenting that the bank remains “well capitalised, liquid and very much open for business”.

Commenting that the bank is “encouraged” by its positive interim performance, he added that, “following a good tourist season, the local economy is performing well and we anticipate continued growth for the foreseeable future.

“However, challenges within the global economy clearly remain. 2011 is likely to see softer growth across Europe, not least because of the impact of a number of austerity packages announced across the European region. We will continue to monitor the current situation closely, as any slowdown in growth in Europe will inevitably impact on the economy in Malta.

“Nonetheless, HSBC has made sustained progress in the period, and we continue to emphasise our competitive advantage as an international bank.”

HSBC Malta reported that it is continuing to provide support for its borrowers as well as security for its depositors. The bank has seen a slight softening in loan demand due to economic conditions and increasing competition in the market. Deposits increased despite growing competitive pressure, including from a number of local government and corporate bond issues.

Profits from the life insurance business remain volatile, reflecting the downward movement in the euro yield curve, which affects underlying actuarial valuations and impacts on the level of reserving.

The bank continued to invest in expanding its business and transforming its operations in the period, while maintaining a focus on cost control. As a result, the cost-to-efficiency ratio was broadly in line with the first half of 2010 and remains well within the bank’s target range.

The bank continues to focus on building a high-quality asset base for the future, and it is encouraging that loan impairments were only modestly higher than in the same period last year and in line with expectations. The credit quality of the available-for-sale investments portfolio, which has improved over the period, remains satisfactory.

The bank has maintained a strong liquidity position and a stable loans-to-deposits ratio over the period, while its capital ratio remains well above regulatory requirements.