La Valette property fund’s external auditor touted for BOV chairmanship

PricewaterhouseCoopers partner Frederick Mifsud Bonnici has been touted as one of the possible candidates to take up the chairmanship of Bank of Valletta, which position is appointed by the Maltese government, government sources have told MaltaToday.

The government holds just over 25% of shareholding in BOV.

BOV's former chairman Roderick Chalmers resigned in June due to personal circumstances.

A finance ministry spokesperson said any announcements for the next BOV chairman would made in a public statement when asked by MaltaToday for a comment on Mifsud Bonnici's prospective appointment.

Mifsud Bonnici currently serves as a director on the board of Malita Investments plc, the special purpose vehicle that will raise the finance to fund the construction of the €80 million Renzo Piano parliament in Valletta.

As PWC partner, Mifsud Bonnici was also the external statutory auditor for the La Valette Funds Sicav, the BOV subsidiary which owns the La Valette property fund and whose investors were paid over €40 million in compensation for savings lost in the fund.

He was present for the 2011 annual general meeting of the La Valette Funds Sicav, where questions were put to him as to whether PWC - the auditors of the Sicav - had reported several breaches of the investment restrictions in the prospectus of the La Valette property fund, to the financial regulator.

The Malta Financial Services Authority later found Bank of Valletta, as well as its subsidiary Valletta Fund Management - which manages the Sicav - responsible for having breached investment restrictions related to the property fund's investment in other underlying property funds.

Bank of Valletta is contesting a decision by the MFSA ordering to pay further compensation to investors of the La Valette property fund.

In June 2011, BOV offered investors a conditional compensation offer of 75c per share after the La Valette fund was found to have lost some €50 million in value. The MFSA later fined BOV and its investment arm Valletta Fund Management €350,000 over a breach of investment services rules.