National Bank shareholders to seek out-of-court settlement

The former shareholders of the National Bank of Malta have voted to negotiate with the government for an out-of-court settlement on their claims for compensation for the shares they signed off to the government in the 1973 takeover and nationalisation of the bank.

One of the shareholders, Jeremy Cassar Toreggiani, was however adamant that the shareholders had valid claims to shares in Bank of Valletta, the successor to the National Bank.

"Government still owns well over 25% of BOV. I believe the most equitable solution is for government to give shareholders their rightful shares in Bank of Valletta. It would be giving the bank back to the shareholders, acknowledging the facts of the case, and this would be a settlement that does not affect anybody negatively. Indeed, it would give renewed confidence in Malta's financial services industry," Cassar Toreggiani said.

But shareholders yesterday resolved to appoint a team of negotiators to open discussions with the finance minister to settle the matter, which has been pending since they first instituted court action against the Prime Minister - then Dom Mintoff - in 1977.

"Other shareholders felt that asking for BOV shares was too bold a statement, but I think it is a valid request. If you have a valid claim, then it's a valid claim all the way. Calculating the Lm5 million lost in 1973 to 2012 levels is quite simple," Cassar Toreggiani said.

National Bank shareholders had previously learnt their claims were being valued at Lm8 million (€20 million) when they filed a judicial protest against the finance ministry which was negotiating the divestment of its shareholding in Bank of Valletta with a foreign bank.

The shareholders' negotiation team will be made up of Milica Micovic and Edward Attard Montalto, heirs to the Tagliaferro Bank; Conrad Cassar Torregiani and Marcus Scicluna Marshall, heirs to the Sciclunas Bank - the National Bank of Malta was a conglomeration of Malta's major banks.

A run on the bank in December 1973 was followed by a demand by the Dom Mintoff government to have shareholders transfer their shares - controversially, without compensation - to the government. The bank later became the Bank of Valletta in 1974.

Labour leader Joseph Muscat held a meeting with Jeremy Cassar Torregiani - grandson of National Bank of Malta founder Antonio Cassar Torregiani, raising the possibility of some form of closure after a legal battle that has dragged on for over 35 years. No final agreement was reached in the meeting, but Muscat told Cassar Torregiani that he intended to set up a 'team of advisers' to draw precise conclusions on the implications of the National Bank court case.