New owners for Satabank

The beleaguered Satabank will have a new lease of life as reputable investors have indicated interest in purchasing the bank. In the coming days, a law will be passed to allow for the setting of a company that will take over the due diligence of dubious accounts and clear them from banks that are facing specific situations, such as Satabank.

The administration will remain within the competent audit company appointed by the financial regulator but with a much more limited scope, and therefore charging far much less.

Ernst & Young will act as supervisors until the transition takes place. This will give breathing space for the bank to get back on its feet with new owners.

A senior source close to the Finance Ministry said that the fees meted out by Ernst & Young made sense in the preliminary stages, but in the long term would have led to the collapse of Satabank. 

Satabank had protested about the exorbitant rates being charged in a formal protest lodged with the Malta Financial Services Tribunal.

The bank, which was ordered by the financial regulator to cease business activity, said it was paying members of the international team up to €689 an hour.

The MFSA had appointed a team from Ernst & Young to monitor the bank in the proper conduct of its business on 15 October, but five days later it ordered Satabank to cease from taking new deposits or effecting withdrawals, freezing the bank’s operations.

But the spokesman said that this was a conscious move by the government to implement procedures which would save banks, in the same way other countries in Europe intervened to save banking institutions.

“We are fortunate to have solid banking institutions, it is now time to think out of the box and save one such institution for the sake of the wider banking sector and business clients, as other countries have done. Satabank will be a first.”

The source said that the initiative is being spearheaded by Finance Minister Edward Scicluna and parliamentary secretary Silvio Schembri.