Malta: Financial Sector Assessment Program-Technical Note-Bank Resolution and Crisis Management

November 21, 2019

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Malta: Financial Sector Assessment Program-Technical Note-Bank Resolution and Crisis Management, (USA: International Monetary Fund, 2019) accessed November 21, 2024

Summary

This technical note analyzes laws, policies, and procedures for bank failure mitigation and resolution, and for preparation and management of a financial crisis in Malta. It addresses the supervision of bank recovery plans, early intervention when problems are identified, resolution planning, resolution funding, and deposit insurance. Implementation of recovery planning requirements for banks remains a work in progress. Written policies and procedures should be adopted on the application of early intervention powers. While legal triggers and power for early intervention in problem banks are adequate, the powers in relevant legislation overlap substantially. Actions are needed to support the use of bank resolution powers, and to address weaknesses in the bank liquidation and insolvency framework. There is lack of clarity regarding the legal regime applicable to bank winding-up and insolvency, including as to the creditor hierarchy in liquidation. Impediments to implementation of the resolution tools are being identified and need to be addressed. Preparations need to be made for using the bridge institution resolution tool.

Subject: Bank resolution, Bank resolution framework, Bank solvency, Banking, Crisis management, Financial crises, Financial sector policy and analysis, Legal support in revenue administration, Revenue administration

Keywords: Agent bank, Bank failure, Bank insolvency case, Bank insolvency framework, Bank insolvency regime, Bank liquidation estate, Bank Reorganization, Bank resolution, Bank resolution framework, Bank solvency, Central bank, CR, Crisis management, Insolvency proceeding, Insolvency regime, Insolvent bank, ISCR, Legal support in revenue administration, Public notice, Recovery plan, Resolution power, Risk management

Publication Details

Pages:

40
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2019/346
Stock No:

1MLTEA2019005
ISBN:

9781513520803
ISSN:

1934-7685

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