Financial Crime World

Malta’s Financial Regulatory Bodies Shine Amidst Global Competition

In a global financial landscape dominated by major economies, Malta’s financial regulatory bodies have emerged as a beacon of stability and robustness. According to the World Economic Forum’s Global Competitiveness Report 2019, Malta ranks 38th out of 141 countries in terms of its local financial system, a testament to the country’s ability to weather the 2008 financial crisis with relative ease.

A Robust Banking Sector

The Central Bank of Malta (CBM) oversees a robust banking sector, with:

  • 17 locally licensed credit institutions
  • Two branches of foreign banks operating on the island

Joint Supervision by the European Central Bank

Malta’s Financial Services Authority (MFSA), jointly supervises the three largest domestic banks with the European Central Bank (ECB) since the introduction of the Single Supervisory Mechanism (SSM) in 2014.

A Competitive and Attractive Jurisdiction

Malta’s reputation as a robust, tax-efficient, and well-regulated EU member state has made it an attractive jurisdiction for:

  • Banks
  • Financial services players

The country has taken steps to maintain its competitiveness, including the introduction of Payments Services Directive II (PSD II), which has encouraged the emergence of payment institutions and electronic money institutions.

KPMG’s Expertise in Malta

KPMG’s local office in Malta provides audit, tax, and advisory services to:

  • The majority of banks and financial institutions on the island
  • Leverage expertise from other member firms, including the KPMG ECB Office, which specializes in issues related to the SSM.

Banks and Financial Institutions Face Regulatory Burden

In an increasingly complex regulatory environment, financial institutions face significant challenges in ensuring compliance with ever-changing requirements. Our experts offer a range of services to help organizations navigate these challenges, including:

Assistance to Compliance Function

  • Developing a Compliance Obligating Register and performing a Compliance Risk Assessment
  • Delivering compliance-related training for Board of Directors, Senior Management, and first-line functions
  • Co-sourcing the Compliance Function for short-term periods
  • Setting up the Compliance Function, including drafting policies, procedures, and frameworks

Assistance to Risk Function

  • Developing a Risk Management Framework, including risk policies, procedures, and assessments
  • Delivering risk management-related training for Board of Directors, Senior Management, and first-line functions
  • Co-sourcing the Risk Function for short-term periods
  • Setting up the Risk Function, including drafting policies and procedures

Other Assistance

  • Agreed-upon procedures and limited assurance engagements
  • Ad hoc regulatory advice and assistance
  • Individual and collective Board Assessments
  • Credit Institutions and Financial Institutions Licensing
  • Assistance in regulatory reporting and review
  • Pillar III disclosures framework setup and review
  • Business model development
  • ESG-related services

For more information, please contact us.