It was a pleasure to organise a seminar on Capital Markets in partnership with the Malta Chamber of Commerce. The seminar was a first of its kind and was organised by Moneybase with the support of Calamatta Cuschieri.
When Moneybase joined the Chamber in 2022, we also announced our alliance agreement with the Chamber where we pledged to work with the Chamber to help local businesses thrive. Since then we have been working with the business community, listening to their needs and pain points and we are now working on developing a tailor-made payment solutions for local businesses.
As a financial services Group, we continue to add value to local businesses in other areas too. Calamatta Cuschieri also provides Wealth Management services to businesses and intends to organise seminars on wealth management specifically for the benefit of local companies.
Capital Markets has grown considerably in Malta, and today we all realise the importance for companies to be able to access finance easily to allow them to flourish and achieve their full potential.
Something that has always striked me in the local capital markets industry is seeing some really talented professionals working closely together like clockwork towards a common goal and to assist companies to achieve their financing needs usually against some very tight deadlines over quite a few coffees.
Here of course I’m not only referring to the people at Calamatta Cuschieri but also the legal and financial advisory firms who apart from being knowledgeable are also really passionate about what they do.
Thanks to these practitioners and also the support of the Malta Stock Exchange, Capital Markets in Malta has been growing steadily and we have seen many success stories in the local market already.
I was therefore delighted to have managed to get the best of what Malta has to offer together to share their knowledge, take part in some interesting discussions and to continue to help local business thrive. It was really great to get everyone together, I would like to thank all the panelists for their participation and all of the businesses who attended this event.
I am attaching some of the keynote presentations here and a commentary below.
More info about Capital Markets in Malta
Intro
CC Finance Group has 3 main components that are Moneybase the fintech division, CC Fund Services and Calamatta Cuschieri. The Group was founded in 1971, and has evolved greatly over the last 51 years, just as the local capital markets and investment industry has evolved. Helping companies raise funds through Capital Markets is one Calamatta Cuschieri’s key strengths and is complemental to other services it offers including Wealth Management, Fund Management, Treasury and trade execution.
Capital Markets in Malta
The Investment and savings market in Malta is circa €15Bn, and this is expected to continue to grow as a function of more affluence and a growing population that has grown from circa 400k to 600k in the last ten years, as a result of this bank deposits of households today exceed €24Bn.
The Malta Stock Exchange started operations in 1992, initially with Government bonds and soon followed by BOV and Mid-Med Bank IPOs. Today the exchange has just over €15Bn of securities trading and this has increased almost two-fold from €8.5Bn 10 years ago.
The growth in Malta’s GDP is highly correlated with the growth of securities on the exchange. What is very interesting, is the fact that this figure is almost exactly the same.
Over the last ten years we have seen the government increase its funding requirements which is done predominantly through market instruments that now total over €8bn.
Similarly, there has been an large increase in corporate bond issues which since 2013 more than doubled in number, from 50 to 120 whilst the value of Maltese corporate bonds have gone from €1Bn to €2.5Bn.
Bonds resonate with investors, however there are very good reasons for the increase in number of bonds and issuers who choose to have public listed bonds as a source of funding. As the size of local corporates grow, companies seek to diversify their funding whilst at the same time improving their governance and credit profile with the market at large.
On the equity front, despite very slow growth in equity number in Malta; we today have 35 companies listed on the on the exchange, 3 of which that were added during 2022 and another expected in 2023.
It is important for Malta to have a liquid functioning equity market for the future as companies mature. Going public or listing you shares is an important tool for succession, increasing governance and growing a company profile. The fact that shareholders selling or financing through an equity issue have no tax incident is another advantage that business owners consider as more industries consolidate and M&A activity increases.
It is also imperative that only companies with a positive track record, a history of earnings growth, a strong potential for future growth, a sustainable market for their product or service, good corporate governance, and a highly qualified management team, should consider going public.
A hypothetical example of what happens to company ownership over a 100-year period. 2 partners start a 50/50 share business. They each have 2 children, that each have 2-3 children each. The 4th generation is no less than 23 individuals. With the largest shareholder having just 6.25% share.
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