The Fitch ratings agency has registered the Bank of Valletta’s long-term credit rating at the level of BBB.
This updated credit rating was also accompanied by an assessment outlook of ‘negative’.
The agency said that this was due to ‘risks from persisting operational risk headwinds and from the bank’s uncertain ability to strengthen its risk governance in a timely and effective manner.’
They add that in order to return the bank to return to a ‘stable’ outlook, BOV needs to make ‘visible progress in strengthening its risk controls without materially eroding profitability.’
While criticising the bank’s operational risk issues, the agency did commend the, ‘adequate capitalisation and stable funding and liquidity,’ and its strong domestic demand.
BOV’s CEO Mario Mallia said that while recognising the issues raised by the ratings agency, ‘Our transformation programme, which is now in full swing, addresses risk governance, business de-risking and anti-money laundering issues. There is no gain without pain, and we will inevitably experiences pressures on profitability for the duration of the programme. But our ultimate goal remains always the long term stability and sustainability of the institution, for the benefit of all stakeholders and of the country in general.’