MFSA Annual Report 2018: A 9.5% Growth in the Financial Service Industry

The Financial Service Sector and the Maltese Economy

Steve Muscat Azzopardi | Published on 16 Jul 2019

MFSA Report 2018 Financial Services Industry

The Financial Services Sector’s Share: Gross Value Added (GVA)  

Contributing around 6% of the Gross Value Added (GVA) during 2018, the Financial Service Industry can be considered as an important aspect in the Maltese economy. As reported by the MFSA Annual Report, which was presented in Parliament on the 10th of July, the Financial Service industry GVA has experienced a growth of 9.5% during 2018, placing Malta at the same level of countries such as Ireland and Luxembourg.  
Notwithstanding the fact that the financial services industry is a competitive sector, the MFSA held that during last year, 144 new entities have been licensed, as various companies have sought to make Malta as their jurisdiction of choice. When taking into consideration both the size of the industry and its activities, the GVA created amounts to around 11.6%, making the financial sector as one of the main contributors of the Maltese economy.  

The Financial Services Sector’s Share: Employment  

During last year, the financial service industry has on average created more than 12,000 jobs, constituting around 5.3% of the total employment. As it has been reported by the MFSA, the share of employment within the Financial Sector has witnessed a growth of 1.4% from 2009. These figures amount to almost twice as much for what it has been recorded for the other member states of the EU.  Furthermore, it has also been reported that the compensation of employees in the industry has grown from €224 million in 2009 to €395 million by 2018.  

Silvio Schembri’s Comments on the MFSA Annual Report  

Parliamentary Secretary for Financial Services, Digital Economy and Innovation Silvio Schembri, has heldsaid that even though last year was quite challenging for the financial sector, Malta still managed to significantly grow this industry, and as a matter of fact, 1,000 new jobs were generated. Moreover, he also stated that such growth is the fruit of the reform which was introduced two years ago within the MFSA.  

Some of the main changes include: 

  • The introduction of new specialised units;
  • The Registry of Companies was decoupled from the MFSA, and it is now referred to as the Malta Business Registry;
  • Investment in technological infrastructure and;
  • A significant growth in investment in human capital and human resources.

Silvio Schembri also announced that during the coming weeks, a consultative body will also be instituted. He concluded by remarking that “Our ultimate aim is to make Malta a centre of excellence for the financial services sector”.  

Mr Steve Muscat Azzopardi, Senior Manager of our Advisory team comments: “these results are extremely encouraging and demonstrate that confidence in Malta as an International Financial Services jurisdiction remains very high. Credit is due to Mr Joseph Cuschieri at the helm of the MFSA  and his team for the efforts being made that are already reaping positive results. We ourselves continue to support a number of UK-based entities to co-locate to Malta amidst Brexit uncertainty, as well as several others coming from both within and outside the EU. 

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