MALTA TIGHTENS FINANCIAL INSTITUTION SECURITY MEASURES TO COMPLY WITH EU DIRECTIVES

The Maltese government has implemented new regulations to strengthen financial institution security measures, aiming to transpose locally part of the requirements of the European Union’s Payment Services Directive 2007/64/EC and Electronic Money Institutions Directive 2009/110/EC.

Strengthening Prudential Supervision and Regulatory Oversight

According to Article 13(2) of the Financial Institutions Act, the competent authority may make financial institutions rules as required for carrying into effect any provisions of the act, and may amend or revoke such rules. The new regulations reflect changes made in May 2010 and June 2011, which aimed at strengthening prudential supervision and regulatory oversight.

New Rule FIR/03: Electronic Money Institutions

The new Rule FIR/03 deals specifically with the taking up, pursuit of, and prudential supervision of financial institutions authorized to issue electronic money. This rule replaces the previous Electronic Money Institutions Directive (EMID/01/2002) on the taking up, pursuit of, and prudential supervision of the business of electronic money institutions authorized under the Banking Act 1994.

References to Directives

Additionally, references to Directives 2006/48/EC and 2006/49/EC throughout these financial institutions rules shall be construed as references to Directive 2013/36/EU (the CRDIV) and Regulation (EU) No 575/2013 (the CRR), and shall be read in accordance with the correlation table set out in Annex II to the CRDIV and in Annex IV to the CRR.

Impact on Financial Institutions

The new regulations have been welcomed by financial institutions operating in Malta, which are now subject to stricter security measures aimed at ensuring the stability of the financial system.