Issue link: https://maltatoday.uberflip.com/i/1158932
22.08.19 11 placed Malta at the forefront of certain sectors, like gaming and others. Good legislation by itself is not enough, but our economic structure, our ecosystem, is, I would say, very business-friendly. For example, there are firms, lawyers, accountants and other CSPs in Malta which are world-class. We have a good IT infrastructure. We're in the EU and you can reach the European mainland with just a two or three-hour flight. We've also got a very favourable eco- nomic environment and a pleasant cli- mate. When you put together all these factors, they create an attractive and sophisticated ecosystem. It is true that recently the MFSA has been criticised, and the challenge is al- ways that you strengthen the institution and you keep strengthening it on an ongoing basis. And you have to keep in mind that what worked 10 or five years ago won't necessarily work today, be- cause the industry – particularly the financial services sector – is changing very dramatically. For instance, super- visory technology and other areas will in five years' time be revolutionised through financial technology. e ques- tion is: do we have the skills to really re-dimensionalise how we do supervi- sion in a highly technological environ- ment? Despite the reputational effect that certain headlines which were doing the rounds could have had, Malta still re- mains attractive. I meet investors and practitioners, locally and abroad, who remain interested in setting up shop in Malta. For instance, in the insurance sector, with the situation concerning Brexit, we've been inundated [with requests] by some of the biggest captive insurance brands in the world which are coming to Malta to set up shop here. is is also true of FinTech companies, banks, payment institutions, invest- ments, wealth management – these are all area where we are still seeing a cer- tain level of growth. Our challenge, at this point, as a juris- diction, is to strengthen our knowledge base and capacity, and to make sure that both the MFSA as well as the practi- tioners and stakeholders up their game. With regards to the aim of upping your game […] can you explain to me in brief what you have done, or are planning to do, in terms of your institution when it comes to your staff and how you will improve their skills, employing people with new skills and introducing new protocols? One of the things that we're doing when it comes to capacity building and resourcing, is that we would like to internationalise the MFSA. I want to make sure that a substantial percentage of our employees come from abroad. Why? It's not because the Maltese are not good enough, far from it. But I would like to have, for instance in our banking supervision unit, individu- als who worked with other foreign reg- ulators, such as the European Central Bank (ECB), and who have experience in how banking is supervised in Europe. e same applies to Maltese nationals – I would like to have exchange pro- grammes, and we're working on this. We aim to have an exchange programme with the ECB, whereby, for instance, 10 of their staff could come to Malta to work for some time at the MFSA, and a group of five Maltese could go to work at the ECB. at will cross-fertilise, up our skills and change our culture of do- ing things. Furthermore, we're employing more people and are investing more in train- ing. Where we lack certain skills, I'm sourcing teams from abroad to work with us. Right now, we have a foreign team helping us in doing on-site inspec- tions. We have the experts helping us, but we also have our own people doing inspections alongside the foreign team, so they can be subjected to on-the-job training. When it comes to knowledge man- agement, technology and information systems, we've just deployed a four- year plan and plan to invest €12 mil- lion in tech. If we succeed in managing data and the latest technology, then the MFSA can become even more profes- sional and efficient in the way it carries out it work. One of the things which attracts foreign companies and foreign investment to Malta is – apart from the fact that we are user-friendly in the way we do things – is that we are efficient. In some sectors, however, we do have certain issues. You've talked about not only the need to improve efficiency at the MFSA, but also to what happens beyond the Authority. I refer to two particular activities – practitioners and the banking system. What do you have to say about these particular role players in this operation? On the practitioners' side, most are professionals in their area, but some aren't. So, it's a question of raising standards, and one of the things I would like to do is raise standards [on the country's various] boards. We are work- ing with the Institute of Directors (IOD) to ensure that whoever is sitting on a board knows exactly what their obliga- tions are. Sometimes I fear there could be individuals who sit on a board to re- ceive an honorarium without knowing what their obligations are, or who the company's shareholders are and which risks the company has. We also need to focus on the quality of the boards and improve on things here. In fact, the MFSA in conjunction with the IOD will be publishing guidance aimed at raising boards' standards. CSPs – of which there are roughly 700 in the Maltese market, and which inter- act on an ongoing basis with the MFSA on behalf of their clients – can also have their standards raised. We need to ensure that every CSP is assessed every year, to ascertain that they have the right skills and that they take on board their responsibilities. e MFSA has to be the institution that car- ries out due diligence, but if we raise the standards of CSPs we can subsequently mitigate the risks of bad actors entering the system. INTERVIEW to meet today's challenges