On 18 July, Bank of Valletta plc issued an announcement to update the investing public on the developments with respect to the La Valette Multi Manager Property Fund.
The Bank referred to the announcement published on 16 June which revealed that the Malta Financial Services Authority (MFSA) imposed an administrative penalty of €197,995 on the Bank and a further €149,821 on Valletta Fund Management (VFM). The administrative penalty was imposed in relation to the breach of investment restrictions of the La Valette Multi-Manager Property Fund. This announcement had also stated that the Bank disagrees with the conclusions made by the MFSA and revealed its intention to file an appeal.
Reference was also made to the company announcement issued on 30 June revealing that investors holding 95.2% of the shares in the Fund accepted the Bank’s buy back offer at €0.75 per share. Following the 30 June deadline, the Bank received other acceptances by mail dated prior to the deadline. As such BOV agreed to endorse these acceptances thus raising the percentage of investor acceptances to 98%.
Given this high acceptance rate to the buyback offer, BOV and VFM have elected not to proceed with the intended appeals against the conclusions of the MFSA as they see little practical merit in an extended adversarial dispute with the MFSA. Nonetheless, both BOV and VFM maintained their views that the MFSA’s conclusions are wrong and misconceived both in fact and at law, particularly, the fact that the institutions’ executives did not execute their duties with due diligence, professionalism and care. In fact, both BOV and VFM, stated that the decision not to appeal the conclusions of the MFSA findings was taken without prejudice in the event that any of the investors who have not accepted the offer (or otherwise disposed of their shares) elect to proceed to litigation.