Malta’s Financial Sector Grows by 11.8% in 2023

On June 26, 2024, the Malta Financial Services Authority (MFSA) released its annual report, revealing an impressive 11.8% growth in the financial services sector in 2023. This robust growth has significantly contributed to Malta’s Gross Value Added (GVA), with the sector generating €1,251 million in 2023. The report also highlighted the sector’s resilience and stability, which has been a beacon of financial innovation and growth.

Key Takeaways

Employment and Licensing

The financial services sector has been a key driver of employment in Malta, adding nearly 6,500 jobs between 2019 and 2023. The MFSA received 352 applications for new licenses in 2023, approving 84% of them, further demonstrating the sector’s vibrancy and attractiveness.

Consumer Protection and Innovation

The MFSA has been proactive in safeguarding consumer interests and enhancing the sector’s integrity. The authority increased its supervisory interactions by 50% between 2023 and 2024 and took 77 enforcement actions. These actions underscore the MFSA’s commitment to financial crime compliance and consumer protection.

Innovation has been at the forefront of the MFSA’s agenda. The authority has been focusing on digital resilience and cybersecurity, viewing these areas as complementary to consumer protection. The MFSA’s digitalisation strategy includes the Supervisory Case Management System (SCMS), which aims to streamline processes and improve supervision.

Regulatory Leadership

Regulatory leadership is another area where Malta has set benchmarks. The MFSA has introduced the Virtual Financial Assets (VFA) Framework and the Notified Professional Investor Funds (NPIF) Framework. These frameworks align with the EU’s Markets in Crypto-Assets (MiCA) regulation and enhance Malta’s attractiveness as a fund management jurisdiction, and contributing to the positioning of Malta at the forefront of digital finance.

Global Collaboration and Stakeholder Engagement

The MFSA has also been committed to stakeholder engagement and global collaboration. The authority signed several Memoranda of Understanding with local and international institutions in 2023. It also hosted 10 regulatory briefings and conferences to encourage dialogue with industry participants and stakeholders. Investing in human capital has also been a priority for the MFSA underscoring the MFSA’s commitment to building a highly skilled and competent workforce.

Conclusion

Looking ahead, the prospects for Malta’s financial sector remain bright. The country is well-positioned to capitalise on emerging trends, such as digital finance and sustainable investing. Moreover, with its robust financial infrastructure and progressive regulatory framework, Malta is poised to continue its growth trajectory, contributing to the country’s economic prosperity and reinforcing its status as a leading financial hub.

For more detailed info please refer to the full MFSA Annual Report 2023.