BOV announces increased charges for business clients with credit facilities

Malta’s leading bank, Bank of Valletta (BOV), has written to its business customers to announce that it is increasing its annual review fee, previously referred to as a renewal fee, on all business credit facilities as from 1st December 2021.

The annual review fee will be increased by 0.05 per cent, from 0.10 per cent to 0.15 per cent, per annum. The minimum rate remains unchanged at €40, BOV confirmed to its customers.

The bank cited its annually increasing “cost-to-serve” its business customers, “mainly due to the additional requirements brought about by a more complex regulatory regime”.

This comes at a time when Malta is ramping up efforts to get off the Financial Action Task Force’s so-called greylist, which puts it under increased monitoring by the global organisation aimed at disrupting money laundering and the financing of terrorism.

It also comes at a time when, for a number of years, the global financial industry has been under increased pressure generally to clamp down on money laundering, resulting in increased regulatory and compliance obligations.

Here, BOV is opting to pass on the cost, at least in part, of increased regulatory requirements to its business clients with credit facilities, including loans and revolving facilities, to be charged upon annual review.

“The applicable review fee will be debited from your operating account upon renewal of your facilities as per current procedure,” BOV told its customers.

This also comes at a time when businesses are facing increased costs across the board. Indeed, higher shipping costs, higher costs of raw materials, staff shortages driving wages up and COVID compliance rules limiting some sectors are among the most pressing issues facing the business community.