Sparkasse Bank Malta And The Financial Industry

Sparkasse Bank Malta Ltd has been providing banking and investing services to fund managers in Malta since 2000. Throughout its existence, the aim has been to provide quality, professional, and effective services to consumers through a devoted and skilled team of specialists. Paul Mifsud, MD, has been involved in this work for over 15 years.

The bank was focused on banking rather than investing services when Mifsud arrived in 2007. “My objective was to turn the bank into an investment services bank by building a strong trading, settlement, and custody arm,” says Mifsud. “This set us apart from other banks on the island at a time when Malta was growing as a fund jurisdiction.”

The bank identified a need to fill a market void. Malta was fast becoming a financial services powerhouse. The fund business was young yet vibrant. As a result of this, the bank developed a banking system with built-in custody. With few other options available, many asset managers went to the bank.

Its success comes from targeting a limited market of investors and custodians. The bank has always sought to attract funds and investment managers seeking a financial institution that understands their needs. A smaller provider of custody and depository services, it might give more assistance and solutions than bigger multinational banks.

“We recognized that we had a niche as a credit institution focused on a particular consumer type,” Mifsud explains. “A fund might be a unit trust, a limited partnership (LP), or the more common SICAV structure. We can assure our clients that we are a bank credit institution with a solid infrastructure and a qualified staff of specialists ready to help.”

The bank has four licenses to operate. It is a depositary/custodian of money, as well as a credit institution. Most financial institutions do not provide these services. Of these, three were granted by the Malta Financial Services Authority, and one by the Central Bank of Ireland. Sparkasse Bank Malta has a competitive edge since it can provide its clients a wide range of services from one platform. ‘’Customers may access banking and investing services from one account,” says Mifsud. “As a depository, we also offer the monitoring required for funds to satisfy regulatory requirements.”

Sparkasse Bank Malta appears to have used this method well. The bank presently employs over 100 individuals and has assets valued at €8.2 billion. Infrastructural and human resource investments have fueled this rise. The bank has been able to keep up with its rising customer base by adopting a technologically advanced approach that includes automating depository activities. Automation has increased efficiency and reduced staff workload.

Certainly, the bank’s prosperity has been aided by its Malta location. Sparkasse Bank Malta opened a branch in Dublin in 2018 to operate as a depository for Irish-regulated funds.

Mifsud adds that Sparkasse Bank Malta prefers to keep things simple. He says the bank’s culture discourages undue risk-taking and it focuses on services where it believes it has the requisite expertise. “We don’t get engaged if we don’t have competence if the legislation is uncertain, or if we lack bandwidth or resources.” According to Paul Mifsud, the bank intends to continue offering custody and depository services, as well as advising and non-advisory services to customers.

“Banking is complex enough without adding more. We’re focused on what we’ve been doing and what we do well, without attempting to develop anything new or disruptive that may distract us from our core goal, which is our valued customers.”