Bank of Valletta says MFSA cleared bank on insider trading

Bank of Valletta has announced an investigation by the Malta Financial Services Authority did not reveal any evidence to substantiate claims that BOV staff or persons connected to them, had access to confidential information when redeeming their shares from the La Valette property fund, months prior to its suspension in August 2008.

BOV said the authority undertook a thorough examination of the redemptions that took place before the suspension of the La Valette fund, after 16% of the fund's shares were withdrawn prior to the stoppage of redemptions.

The MFSA Authority yesterday issued a reprimand to former La Valette property fund director John C. Ripard, a former director of the La Valette property fund, for having sold his holding in the fund on the basis of insider information.

Bank of Valletta chairman Roderick Chalmers has insisted no members of the banking group, staff or their families who traded in the La Valette fund have ever had access to privileged information, when a massive €16 million in redemptions took place before the fund was suspended in 2008 after losing €50 million in value.

"That remains the Chairman's firm view. John Ripard is not, and has never been, a member of the Bank of Valletta Board, management or staff," the bank said, insisting on Ripard's separate role as a director of the Sicav and not a member of the banking group.

"The Authority has concluded that 'its investigation did not reveal any evidence to substantiate the claim that BOV staff or persons connected to them used confidential information as a basis for their decision to redeem their shares from the Fund during the months prior to suspension of redemptions that took place on 8 August 2008'," the bank said in a statement.

BOV said the regulator was provided with all data on purchases and redemption of shares, and that its investigation included interviews with relevant BOV officials, the review of minutes of meetings, correspondence and data collected by the Authority from BOV, Valletta Fund Management, Valletta Fund Services and La Valette Funds sicav.

The bank said the MFSA also scrutinised redemptions that took place in 2008, particularly redemptions that took place between April and August 2008 to determine whether any of the redemptions were unusual or out of line with the general pattern of redemptions that took place at the time.

"Bank of Valletta has long maintained that it did not believe that any members of the Bank of Valletta Group management, staff or their families had traded in La Valette property fund units on the basis of having had access to privileged information. The bank is therefore pleased to note that after a thorough and detailed investigation, the MFSA's report has arrived at the same conclusion, and that all members of the Bank of Valletta Group management, staff and their families have been fully exonerated in respect of the unsubstantiated allegations that have repeatedly been made by certain third parties over many months."