MFSA publishes supervisory priorities for 2021

On Thursday, the Malta Financial Services Authority (MFSA) published its Supervisory Priorities for 2021. This detailed document provides updates on the areas of focus which had been identified for 2020 and sets out the priorities for the upcoming year.

Five cross-sectoral priorities have been identified, namely: [i] Corporate Governance and Culture; [ii] Financial Crime Compliance; [iii] the impact of COVID-19; [iv] ICT Risk and Cybersecurity; and [v] FinTech and Innovation.

These are complementary to the investor protection, market integrity and financial soundness objectives of financial regulation, which remain at the forefront of the Authority’s agenda.

Building on the cross-sectoral priorities, sector-specific areas of focus have also been identified. The priorities do not encompass the entire spectrum of work performed by the MFSA but document the themes on which supervisory focus is to be expected.

The document also highlights the MFSA’s risk-based approach to supervision, which seeks to ensure efficacy and effectiveness of supervisory efforts, together with select key initiatives which may possibly have an impact on stakeholders.

Further to the Supervisory Priorities, the Authority will be focusing on:

[i] continuity – the implementation of the three-year strategic plan 2019-2021 will continue and the tone set for the next strategic period (2022-2024);

[ii] stability – the MFSA will continue to focus on achieving long-term stability for the benefit of the financial services sector; and [iii] growth – the sustainable growth of the sector shall be prioritised through initiatives such as the Capital Markets Strategy, Asset Management Strategy, FinTech Strategy and the review of the Virtual Financial Assets Framework in line with the European Commission proposed Markets in Crypto-assets regulation.

MFSA Chief Officer Supervision and Chief Executive Officer ad interim, Dr Christopher P. Buttigieg, commented that “Supervision is core to the MFSA’s function as the single regulator of financial services in Malta.

“In 2020, in line with MONEYVAL recommendations, supervision has been strengthened and we have significantly increased the number of onsite inspections conducted. By virtue of this publication we are identifying those areas which will be the focus of our supervisory efforts in 2021. It is our vision to establish Malta as the jurisdiction of choice for financial services. Going forward, the Authority shall seek to strengthen itself as an institution by focusing on stability, continuity, and growth.”

The document is publicly available on the MFSA website.