The part-nationalised Österreichische Volksbanken-Aktiengesellschaft has officially started the sales process of its bank subsidiary Volksbank Malta.

The sale is part of the European Commission’s restructuring plan for VBAG, according to which VB Malta has to be sold by the end of 2015.

The bank has hired KPMG to advise on the sale of its bank business in Malta as part of an EU-mandated revamp, it said this week.

Volksbanken has to sell Volksbank Malta Ltd and a 51 per cent stake in its deconsolidated Romanian banking business – which it has entirely written down – by the end of 2015, as well as its 50 per cent stake in VB Leasing International by the end of 2014.

Volksbank Malta Ltd (VB Malta) made a net profit of €2.2 million ($2.9 million) last year on total assets of about €540 million. It has a loan book of about €110 million with retail and corporate customers.

Volksbanken said it would carve out the Malta unit's international finance syndication business before the sale.

VB Malta was incorporated in 1995 and in the past years has constantly generated profits. In the financial year 2012, profit after tax amounted to €2.2 million based on total assets of approx. €540 million

The bank has a very stable balance sheet structure with an extraordinarily strong equity base.

The bank has held a commercial-bank licence since 2002. It conducts a local banking business in Malta (retail and corporate financing for mainly local customers with a volume of approx. €112 million) and is further syndicate partner in international financings.

Such international financings will be carved-out of VB Malta prior to its sale and the capital will, in coordination with the local supervisory agency, be adjusted to reflect the lower business volume.

Acquisition target of this transaction will be the local banking business only, based on a solid equity base.