The Bank of Valletta Group registered € 22 million in the first quarter of 2022, an increase of € 12.7 million from the same period in 2021. This improvement reflects a continuous but still incomplete recovery from the COVID-19 pandemic, and banks encouraged economic activity, stating in a stock exchange company statement.
Nevertheless, the Group anticipates the development of risks arising from geopolitical instability that could potentially impact the local economy and our business.
In response to these developments, the Group maintains a cautious outlook, especially regarding its attitude toward credit provision, and its first-quarter results do not necessarily represent the full-year 2022 results. In the first quarter of 2022, the Group’s revenue was € 58.4 million, an increase of 5% compared to the 2021 comparison period.
This is primarily due to the consistent growth of lending, especially mortgages, and the increase in revenue from the payments and card businesses. Operating expenses for the first three months increased by 3% compared to the same period in 2021. This is mainly due to the increase in employee compensation costs due to the increase in personnel and higher customer deposit levels.
Investing in the BOV2023 strategy is at a relatively slow pace due to certain regulatory commitments, while continuing to invest in strengthening risk governance and control, with a particular focus on process transformation and improved customer experience. It was continued. The € 7 million reversal of the net expected credit loss (“ECL”) contributed to profitability in the first quarter of 2022.
The bank said this reflects individually significant exposures, coupled with better economic conditions that have a positive impact on the expected performance of a particular sector and better collateralized positions.
In addition, it incurred € 4.8 million in long-term unpaid non-performing loans during the quarter, supporting the Group’s cautious approach. We continue to actively assess expected credit losses as the economic outlook evolves.
Compared to the same period in 2021, where more cautious future prospects affecting the results of actuarial models are the main factor, the share of results from insurers has declined significantly. 2 In the first quarter of 2022, net lending and down payments to customers increased by 2%. Growth was reported on both business and mortgages, the latter being the main driver. Customer deposits were primarily short-term deposits, up 1% over the period.
During the second quarter of 2022, the bank said it would continue to strengthen its position in the minimum requirements for self-financing and eligible debt (“MREL”) in line with ongoing regulatory requirements. The issuance plan for preferred preferred bonds in the international market will be specifically implemented to achieve the immediate MREL target.
Banks’ ongoing digitization strategies are evolving by leveraging new technologies and adopting slimmer processes to improve efficiency and accuracy. In particular, the entire process behind the two core customer services of mortgages and investment services has been significantly simplified in recent months through end-to-end streamlined digital processes that enhance customer centricity and user experience. Continued to digitize.
We continue to enhance the services offered through our extensive branch footprint by improving the working environment for our colleagues while improving the customer experience with a modern layout that aims to reduce latency and enhance privacy. He said he is still working on what to do.
After the concept branch was opened in Sliema in 2021, the branch network has been rapidly modernized and is now being refurbished in the Paola, Siggiewi and Zuriek branches.
The pace of change remains decisively balanced with the Bank’s obligation to provide superior control in line with regulatory requirements. To this end, the Bank continues to invest heavily in risk, compliance, auditing enhancements and digitization. With this investment, BOV is making great efforts to minimize its negative impact on its customers while maintaining resilience and sustainability.
The World Bank said it would continue to monitor and evaluate new developments after Russia’s invasion of Ukraine earlier this year, whether it could affect the Bank’s position and the quality of its assets. To the extent of the loan, the Bank has not been significantly exposed to Russia or the Russian people. In addition, the exposure due to Ukraine or its bordering countries is also low, which is not significant when compared to the entire loan portfolio.
Banks say they are scrutinizing possible economic and business implications as both Russia and Ukraine are major exporters of major global inputs in areas such as energy, metals and crops. rice field. The direct trade relationship between Malta and the two countries is small and focused on specific products. However, the indirect impact of the price dynamics of products traded in the international market and the economic dependence of Malta’s other trading partners on Russia and Ukraine is this disadvantage directly related to Malta’s businesses and households. Causes a supply shock.
As a result, the World Bank conducted an impact assessment to assess the indirect impact of the Russian-Ukraine conflict on sectors that could be affected by bottlenecks in the supply of many resources and materials. The World Bank simulates three different severity scenarios, and even in the most stressful of these scenarios, the World Bank is pleased to be able to absorb the negative effects. Given that the fluid situation could worsen, the bank said the situation would continue to be monitored.
https://www.independent.com.mt/articles/2022-05-05/local-news/BOV-Group-registers-22m-profit-in-first-quarter-bank-monitoring-effects-of-war-in-Ukraine-6736242701 BOV Group recorded a profit of € 22 million in the first quarter and banks are monitoring the impact of the war in Ukraine