Controversy blocks publication of Bank of Valletta history - MaltaToday
Nationalisation of Maltese banks under Dom Mintoff - MaltaToday
News | Sunday, 29 March 2009
The controversy surrounding the forced nationalisation of the National Bank of
Malta, precursor to the Bank of Valletta, still casts a shadow over the
financial institution 30 years after the event – to the extent that a history
of BOV, commissioned by the bank itself, has been withheld for publication.
Historian Henry Frendo was commissioned to write a 200-year history of the illustrious bank, from its inception as the ‘Anglo Maltese Bank’ in 1809 to the present, but the book but has not yet seen light of the day due to legal advice against its publication.
Frendo spent six years compiling the history of Malta’s banking development, with exclusive interviews with banking veterans who shed some crucial light on the goings-on behind the nationalisation of the National Bank in the 1970s.
According to former BOV chairman John C. Grech, the bank’s lawyers had advised the bank’s directors against publication since the book carried interviews with people still claiming compensation from the government for shares they held with the National Bank.
“The lawyers had advised us that since the claims were still sub judice, it would be incorrect to publish interviews with people who might have had an interest in making certain claims that would interfere with the ongoing court cases,” Grech said.
The National Bank of Malta was hit by a run on its reserves back in December 1972, but its original shareholders claim the Central Bank of Malta had refused to act as lender of last resort, and even blocked attempts by Barclays Bank to loan money to the NBM. In four days, the run on the bank saw enormous withdrawals totalling at least Lm2.5 million.
Around 350 shareholders lost their shares after they were forced to sign them over to the government, without compensation. Prime Minister Dom Mintoff had threatened in parliament that if the bank’s directors refused, he would remove the limited liability of the banks’ shareholders, extend it beyond the bank’s capital to their personal assets, and withdraw the four million pounds in parastatal funds which were deposited at the bank.
The case concerning the compensation to shareholders by government has been running since 1972 and so far has not yet been concluded.
But in 2005, informal discussions between Investments Minister Austin Gatt and the National Bank shareholders were held over an Lm8 million compensation package to the shareholders.
See History of the bank
I beg to differ on a number of
statements made by Raymond Sammut in his letter of 1 March. He certainly
makes every effort to portray his idol as a genius and saviour of Malta.
Who of us who lived in that era can forget ‘Mintoff, Is-Salvatur’?