Bank of Valletta (BOV) delivered a profit before tax of €135.1 million for the first six months of 2025, as the bank maintained a strong capital base and navigated a volatile international environment. Chairman Gordon Cordina said the results reflect a “stable trajectory” for the bank and the wider Maltese economy, even amid global uncertainty.

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The performance, slightly below the €148.2 million reported in the first half of 2024, corresponds to a pre-tax return on average equity of 18.9%. Core income remained resilient, supported by €188.7 million in net interest income and €39.9 million in fee and commission income, even as the European Central Bank implemented four interest rate cuts totaling 100 basis points. BOV’s strategy of shifting liquidity into longer-term treasury instruments helped cushion the impact of lower rates.

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Cordina described the bank’s outlook as “cautiously optimistic,” noting that Malta’s economy appears relatively sheltered from the turbulence caused by geopolitical tensions, trade wars, and shifting global supply chains. “For an economy of the size and openness of Malta, maintaining stable growth in the wake of this turmoil is of paramount importance,” he said. BOV’s own survey of major clients found limited exposure to U.S. tariffs, with most respondents reporting no anticipated impact on employment.

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The chairman highlighted that Malta’s fiscal deficit and debt-to-GDP ratio remain on a stable path, while inflation is expected to normalize around 2% and unemployment remains historically low at about 3%. He warned, however, that extreme global shocks—such as higher energy prices or disruptions in tourism and exports—could still affect the island’s economic trajectory.

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BOV’s half-year results were bolstered by robust capital and liquidity. The Common Equity Tier 1 (CET1) ratio stood at 21.3%, well above regulatory requirements, and total assets rose to €15.9 billion. Customer deposits reached €13.1 billion, while the bank’s credit portfolio expanded by nearly 8% to €7.4 billion. The group also completed a heavily oversubscribed €150 million bond issue in June, the largest corporate issue on the Maltese market, underscoring investor confidence.

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Shareholders will receive an interim gross dividend of €55 million, equivalent to €0.0856 per share, representing a 39.9% payout ratio of profit after tax. The bank also plans a share buy-back program—without share cancellation—to enhance equity liquidity. Combined with dividends, BOV will distribute a record interim shareholder payout, with approximately €35.7 million paid in cash, €46 million retained in the bank, and €7.8 million allocated to the buy-back reserve.

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Chief Executive Officer Kenneth Farrugia said the bank’s strong numbers are driven by solid performance in core lending and treasury operations, alongside cost efficiencies from digital initiatives. He noted that two-thirds of the ATM fleet will be replaced by year-end, with new machines offering contactless features, and highlighted new offerings like commercial card platforms and student loan products in collaboration with the Malta Development Bank.

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Looking ahead, BOV upgraded its full-year profit guidance to a range of €215 million to €250 million, citing continued momentum in core operations and stable economic conditions locally. Cordina emphasized that the bank’s strategy will remain focused on supporting Malta’s export-oriented businesses, optimizing its capital structure, and maintaining a prudent balance between shareholder returns and long-term resilience.

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“BOV’s role is to stand as a stabilizing force in a world of surprises, risks, and uncertainty,” Cordina said. “We are prepared for any eventuality that may occur, while continuing to support the sustainable growth of competitive business from Malta.”

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