HSBC Bank Malta plc - Interim Directors’ Statement

On 11 May, HSBC Bank Malta plc published its Interim Directors’ Statement covering the period from 1 January 2012 to 11 May 2012. During this period, the HSBC Malta Group delivered a solid financial performance on the back of improved profitability in the life insurance business following the rally across global investment markets. The Bank also reported an improved cost-to-income ratio as the growth in operating income outpaced expenditure.

Nonetheless, the Bank experienced a slight softening in loan demand during the period under review reflecting the slowing economic conditions. On the other hand, corporate and institutional deposits increased whilst retail deposits were broadly unchanged despite the significant competitive pressures. Overall, the Bank’s loan to deposit ratio was stable.

The Directors also noted that, notwithstanding the prevailing economic uncertainties, no material new impairments were charged during the period under review. Moreover, the Bank’s available-for-sale portfolio remains well diversified and conservative. Similarly, HSBC maintained a strong liquidity position and capital ratios well above regulatory requirements.

In conclusion, the Directors explained that in spite of the increasingly difficult market conditions, the Bank is well placed to meet both current and future challenges. The Group’s CEO, Mr Mark Watkinson stated that the Bank “will continue to focus on improving productivity and cost effectiveness to deliver long-term business sustainability”.