Malta is currently on the forefront in financial services news - the country has a compelling economic success story to tell and the following statistics and rankings are but a few of the success features that the country currently flaunts.
- Financial Market Development – Malta ranked 11th out of 139 countries (World Economic Forum’s ‘Global Competitiveness Report 2010-11)
- Strength of Auditing and Reporting Standards – Malta 8th (up from 12th the previous year),
- Soundness of Banks - 10th (up from 13th),
- Regulation of Securities Exchanges - 12th (up from 13th) and
- Competitiveness - 50th in the overall ‘global rankings’ (up from 52nd).
- Foreign direct investment [FDI]
- €11.9bn (end of June 2010),
- nearly double the previous year’s amount
- significant equity capital injections into foreign companies,
- 83% of that increase was in financial intermediation
- Gross Domestic Product - Financial Services accounts for 12% of Malta’s GDP
A 2003 IMF/World Bank review concluded that Malta’s financial sector was well supervised. The EU also conducted a regulatory review prior to EU entry in 2004. The MFSA carried out internal audits in 2005 and 2007, and another was due in 2009, but the board of governors decided that that audit should be an independent assessment along IMF/World Bank lines, and with a view to increasing transparency, it should be published.
Consequently, a team of experts that is normally used by the IMF and World Bank was called in last year to review how well Malta’s regulatory structures complied with the Basel core principles for banking, IOSCO’s International Organisation of Securities Commissions) principles for securities,
and IAIS’s (International Association of Insurance Supervisors) principles for insurance.
“This was rather a bold step because, obviously, nobody knew what the result was going to be,” says Mr Bannister. “The team was led by Piero Ugolini, former assistant director at the IMF, who was also mission chief for the IMF/World Bank review of 2002-03. The results of the assessment, published in January this year, were excellent. For example, in the case of banking, the number of principles the MFSA was found to be compliant with increased from 11 in 2002-03 to 21, out of 25. An abridged and a long version of the report is available on the MFSA website.”
