Alfred Mifsud ‘would consider’ new CBM deputy role

Economist Alfred Mifsud "would consider" taking up the role of second deputy governor of the Central Bank of Malta, the Malta Independent has reported.

But the former Mid-Med Bank [now HSBC Malta] chairman, said he has not been approached on the matter. Mifsud is the owner of investment services firm Crystal Finance Investments, where Prime Minister Joseph Muscat was employed for some time before his foray into European politics.

A row has broken out between Labour and the Nationalist opposition over the appointment of a second deputy governor to the central bank, with  the PN accusing the government of politicising the Central Bank of Malta.

Malta is setting up a new Financial Stability Board (FSB) - a joint effort of the Central Bank of Malta and the Malta Financial Services Authority - that will be headed by a new deputy governor with specific responsibility for financial stability, on the model followed in many European countries such as the UK and, most recently, Hungary.

Shadow finance minister Tonio Fenech has accused the government of creating a new post to fill with a politicised appointment, an accusation the government responded to by saying Fenech appointed a former PN minister - Josef Bonnici - as CBM governor.

Finance minister Edward Scicluna said the decision to establish the FSB and hire an additional deputy governor at the Central Bank was taken in April this year following five months of consultations with the CBM, "which in turn sought both informal and formal opinions from the European Central Bank (ECB) on the wording of the proposed amendments."

In an opinion published on its website last month, the ECB said it welcomed the article in Malta's new central banking law "which provides for the appointment of a second deputy governor, who will be responsible for the financial stability mandate".

It said a number of Eurosystem national central banks "already employ this arrangement, based on an allocation of tasks". "The ECB agrees that having two deputy governors, one responsible for the monetary policy mandate and the other for the financial stability mandate, will improve the streamlining and effective division of responsibilities at senior management level within the CBM," the ECB said.