Malta’s Banks Remain Resilient Despite Global Risks CBM Report Finds

Malta’s financial system remains resilient and well-positioned to withstand international economic shocks, according to the Central Bank of Malta’s latest Financial Stability Report.

The report, which reviews developments throughout 2025, found that Malta continued to outperform the wider euro area despite ongoing global challenges, including geopolitical tensions, supply chain disruptions and volatility in energy and commodity markets.

According to the Central Bank, the Maltese economy maintained strong growth during the year, while the country’s banking sector remained stable with robust capital and liquidity levels.

The report also highlighted improvements in the quality of banks’ assets, pointing to the overall health of the sector.

While inflation remained relatively stable, it continued to sit slightly above the eurozone average. The Central Bank attributed this largely to higher food prices, services costs and domestic wage-related pressures.

Looking ahead, the bank warned that inflation could still face upward pressure from international developments, particularly ongoing geopolitical instability and disruptions to global supply chains.

Meanwhile, lending activity continued to increase, driven by strong demand for home loans and increased borrowing by businesses. While this supported economic growth, the report noted that it also increased exposure to property-related risks.

Beyond traditional banking, Malta’s insurance and investment fund sectors also continued to expand throughout 2025.

Insurance companies recorded growth in their balance sheets, while investment funds saw increased allocations towards equities and more diversified bond investments. Both sectors maintained strong liquidity and low levels of leverage, helping them remain resilient to market volatility.

The report also explored several emerging risks and trends, including cyber-related threats, banks’ exposure to sovereign investments and public perceptions of systemic financial risks.

Overall, the Central Bank’s assessment paints a picture of a financial system that remains stable and resilient, even as uncertainty continues to shape the global economic landscape.

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Gabriel Falzon

Gabriel Falzon is a social media executive at Lovin Malta, with a keen interest in digital media, local businesses, and the natural world. Outside of work, you’ll often find him baking up a storm, diving into video games, or exploring the endless corners of YouTube.