Financial Crime World

Malta’s Financial Regulatory Body, MFSA, Set to Shape Country’s Financial Sector

The Malta Financial Services Authority (MFSA) is the single regulator of financial services in Malta, responsible for overseeing various sectors including banking, insurance, investment, and securities markets. Since 2018, the MFSA has also been tasked with regulating Virtual Financial Assets.

Core Values

The authority’s mission and vision are guided by five core values:

  • Integrity: Acting with fairness, objectivity, and respect when dealing with consumers and licence holders.
  • Fairness: Ensuring that all stakeholders are treated equally and without bias.
  • Objectivity: Making decisions based on facts and evidence, without external influence.
  • Reliability: Consistently delivering high-quality services and outcomes.
  • Professionalism: Conducting business in a manner that reflects the highest standards of expertise and competence.

Strategic Statement

In February 2023, the MFSA published its Strategic Statement, which outlines the high-level areas it will focus on to deliver on its statutory responsibilities over the short to medium term. The statement identifies key areas of activity, including:

  • Risk Management: Identifying, assessing, and mitigating risks in the financial sector.
  • Supervision: Monitoring and regulating financial institutions to ensure compliance with laws and regulations.
  • Regulatory Development: Developing and implementing new regulations to address emerging trends and issues.

Supervisory Priorities

The MFSA’s Supervisory Priorities for 2024 have been identified following careful consideration of market conditions and regulatory developments. The priorities are informed by:

  • European Supervisory Authorities’ priorities
  • Those of the European Central Bank (ECB)
  • Direction provided by the European Commission

Risk-Based Approach to Supervision

The MFSA is committed to adopting a risk-based approach to supervision, which enables it to allocate resources effectively and prioritize supervisory plans and procedures based on the unique risk profile of each firm under its supervision.

Governance Framework

The authority’s Governance Framework document outlines the parameters within which it operates, defining:

  • The constitution of the MFSA
  • The roles and responsibilities of its internal governing bodies

Risk Appetite Statement

The MFSA acts in accordance with its Risk Appetite Statement, which sets boundaries for acceptable levels of risk in key areas of its activities. The statement seeks to ensure better identification, evaluation, management, and communication of risk.

Conclusion

By adopting a risk-based approach to supervision and committing to integrity, the MFSA is well-positioned to shape Malta’s financial sector and protect consumers and licence holders alike.