The €30 million over 8 years Maltese banks will be required to give to the European bank resolution fund will act as a buffer for any future bank defaults, Minister of Finance Edward Scicluna said this evening.

This fund will ensure that, should a bank falter, there would be an amount of money to help bailout its customers. “Be assured, this fund will be tightly regulated,” the Minister explained. Depositors will be the last people affected by any future defaults, as shareholders will take the brunt of the impact. “This system was set in place in order to ease the mind of depositors”.

Banks not only contribute to society through the creation of jobs, but also through our economy, he argued. The Minister was inaugurating the new Banif bank branch in Paola. He emphasised the rapid growth of the bank ever since its launch in Malta just 6 years ago.

The Minister stressed the importance of banks in the eyes of the government. “When it comes to banks, there’s no division in government. We all support our robust banking sector”.

The financial crisis took a great toll on Europe, however Maltese banks pushed through, he said. Currently 3 banks are undergoing stress tests (a model designed to test how a bank would handle the worst case scenario), he added.

Banif Bank Chairman Michael Frendo said that the bank recorded positive results across all key profit indicators and experienced an increase in the number of loans granted and client deposits this year.

Banif CEO Joaquim Francisco Da Silva Pinto described Paola as the foremost trade centre in the South of the country. The main reason for opening a branch in Paola was a recorded increase in bank clients from the locality.

“It’s not easy to find the perfect location for a bank, which is why it took us this long to open up a branch in Paola,” the CEO explained.

This branch will house a corporate and business banking team, which offers services for micro businesses. Dr Scicluna explained that over 90% of Maltese business falls within the SME sector.