APS Bank CEO Marcel Cassar: ‘Bank’s desire to scale is common sense’

“We have long been mentioning scale and scope in our announcements, probably since 2022 if not earlier. Why? I would say it’s common sense for an organisation like ours that is investing in its future.”

APS Bank Marcel Cassar made these comments in a question and answer session following the reporting of the bank’s results for the third quarter of 2024, where it registered a decline in profits while continuing to increase its loan book.

He was replying to a question about APS Bank’s intentions regarding the possible acquisition of HSBC Bank Malta – a story first reported on WhosWho.mt.

Mr Cassar was careful not to confirm or otherwise the state of any potential ongoing negotiations, telling stakeholders that the bank is “not interested in making news – only reporting it”.

He nonetheless shared why the bank’s drive for scale is “common sense”, arguing that “having invested in cutting edge technologies, in resources, talent, governance,” and every other area of the bank’s operations, thereby “transforming the network, channels and product suite … it is obvious that you think of the need to gain scale and scope.”

He further acknowledged that the bank “looks for these opportunities while keeping an open mind.”

The CEO said it is “our duty, our responsibility, as management and on behalf of the Board, that as a responsible organisation we are continuously analysing potential opportunities arising in our national market.

“There is lots of value in our bank that is yet to be unleashed. So we owe this to our shareholders.”

Commenting on the bank’s results, he said the easing of monetary policy and roll-out of interest rate cuts “continue to contrast with heightened geopolitical risk and conflicts in various areas, a slowdown in economic growth in China and uncertainty around the outcome of presidential elections in the United States.”

He continued: “As banks across Europe, including Malta, have benefited from a profits bonanza thanks to higher interest rates, retail banking strategies will now turn more defensive in the face of increasing headwinds: cost inflation, including from technology and fraud protection, rising customer expectations, uncertainty about interest rates and higher credit risk as post-pandemic economic boosts are now wearing off.

At the same time, economic activity in Malta is resilient, although growth is expected to moderate from the high rates experienced in recent years while employment, inflation and debt/GDP indicators remain at healthy levels.”

Mr Cassar said the APS Bank strategy remains focused on “delivering simpler banking”, by strengthening its products and digital offerings and enhancing the experience for all consumers.

“We are also taking a broader view of the interest rate cycle, noting that the measures we implemented in Q2 2024 to ease margin pressures are helping us keep our pricing competitive while supporting profitability.

“As we continue to see steady growth in our customer and business base, along with improvements in efficiency and revenue potential, the Bank’s and Group’s strategy is focused on gaining scale and scope from the substantial, transformational investment we have been making in technology, talent and systems.

“We are confident that this will not only consolidate our market position and sustain our competitiveness but will also be in the best interests of all our stakeholders.”