Bank of Valletta will no longer charge high balance fees on deposits to non-personal customers, following the interest rate hike by the European Central Bank.
The high balance fee was introduced following the negative interest rate scenario that prevailed until the end of July 2022.
BOV specifies in a press release that the fee has been withdrawn from the tariff of charges as of August 1, 2022.
Albert Frendo, director of corporate banking, said BOV is following and adapting to the changing environment. “We ensure that changes in market dynamics are reflected in our pricing and business strategy.”
The ECB raised its key rate by 0.5 percentage points to 0% last month and plans further hikes this year in a bid to calm runaway inflation. The rate has been negative since 2014 in an effort to revive the eurozone economy after years of weak growth.
But with inflation on the rise, the ECB has been forced to intervene, even as economists fear the European economy could slip into recession.
Frendo said BOV ensures that the level of corporate deposits is sustainable and within required parameters. “With this in mind, we ensure that any benefits resulting from market changes flow immediately to the customer, while effectively managing negative changes as much as possible,” he said.
The bank said its decision was part of other efforts to support Maltese entrepreneurs. “In an ensuing period of inflation, the bank continues to ensure that it remains the leading provider of trade finance, underpinned by strong credit fundamentals and effective feasibility assessments to continue to support sustainable economic growth in the various economic sectors that drive the Maltese economy,” says Frendo.