17 September 2003

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Austrian banking group opens shop in Malta, targets niche market

BAWAG PSK Group, the third largest bank in Austria with a balance sheet amount of Lm21 billion, has opened a 100 per cent-owned subsidiary in Malta with a capitalisation of Lm210 million.
The Malta Financial Services Authority granted a banking licence in terms of the Banking Act and the new bank is inaugurated this week in the presence of Finance and Economic Affairs Minister John Dalli and BAWAG PSK Group CEO Johann Zwettler.
BAWAG Malta Bank Ltd is not a retail bank, but will concentrate primarily on commercial banking, offering loan and deposit services in any currency other than the Malta Lira. There is to be a strong focus on financing of projects for both the public and private sectors, in Malta and over the whole of the Mediterranean basin. BAWAG Malta Bank Ltd will also participate in international syndicated loans for corporate entities, banks and sovereign states in the Mediterranean region, and in structured security transactions. The bank will also issue bonds in Malta to international investors, in line with the special incentives on money market term deposits for Austrian companies.
The managing director of BAWAG Malta Bank Ltd is Dr Otto Karacek, who is Austrian. The chairman is Dr Francis Vassallo, who is Maltese.
BAWAG PSK Group is expanding into the new, potential and existing member states of the European Union, by buying existing operations, setting up new banks, or opening representative offices. Malta is the latest such move. BAWAG is already present in Hungary, Slovenia, Slovakia, the Czech Republic and Ireland, besides Austria. Johann Zwettler said: "This step shows our confidence in the expansion of the European Union. Growth in Malta is likely to be boosted. The Maltese market is very important to us, but it also allows us access to much of the Mediterranean region. This is an on-shore operation, and we want it to be a Maltese bank."
Dr Otto Karasek said: "The process of setting up this operation has been very efficient. We made our initial enquiry with the Malta Financial Services Authority in February, and here we are in September, ready to begin. The MFSA process was dynamic, structured and consistent. We have also received highly satisfactory service from all those involved in the actual setting up of these offices."
Dr Francis Vassallo said: "BAWAG has taken Malta very seriously. The Malta operation is highly capitalised, but the risk is considered to be low because of political stability and the security engendered by membership of the European Union. The Maltese tax regime is favourable, but these have been the crucial points.

Copyright © Newsworks Ltd. Malta.
Editor: Saviour Balzan
The Malta Financial & Business Times, Newsworks Ltd, Vjal ir-Rihan, San Gwann
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