Partit Demokratiku concerned regarding Financial and Banking Sector

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http://maltawinds.com/2018/04/07/partit-demokratiku-concerned-regarding-financial-and-banking-sector/

Partit Demokratiku believes, from knowledge it has, that the possible withdrawal of HSBC from Malta is purely for commercial reasons and not political, and that nothing else should be read from the information circulating.

PD, however, is concerned regarding other worrying signs within the banking sector.

  1.    The inability of Cypriot Popular Bank Public Company Ltd to sell its 49% share in Lombard Bank which led to the government controversially offering to acquire them with money from the National Development and Social Fund (the money from the sale of passports), a fund not set up for that purpose.
  2. The ongoing scandal regarding Pilatus Bank and the failure of the MFSA and FIAU to fully investigate it last year despite allegations of money laundering coming from more than one source, and the knowledge that the Chairman of the same bank was under investigation by the FBI.
  3. The arrest of that same chairman in the United states of America triggering a reactive clamp down of the activities of Pilatus Bank. Something that should have been done much earlier and has led to a further deterioration in the reputation of our regulatory capabilities in the financial sector.
  4. The fact that Bank of Valletta was used by Pilatus bank to service dollar transactions after its correspondent banks in the USA stopped doing so due to concerns regarding its operation.
  5. The fact that Wells Fargo and J P Morgan as well as Deutsche Bank no longer act as correspondent banks to service dollar transactions for Bank of Valletta, partially due to fact 4.
  6. For reasons not fully explained, the resignation of the long serving Director of The MFSAs banking supervisory unit, Mr. Karol Gabarretta. This sends signals that all is not well at the MFSA.

PD would like to emphasise that our entire service-based economy hinges on having a strong, well-regulated financial sector. The online betting industry would cease to be able to function if our local banks are shunned by those overseas with a subsequent collapse of our economy.

If HSBC Holdings Plc does indeed decide to leave Malta it would be far easier to sell HSBC Malta to a reputable bank if we as a country were just as reputable. We urge the government and our regulatory institutions to get their act together immediately and investigate and clamp down on any abuse within the sector as soon as possible, no matter how close to home it is.