Bank of Valletta (BOV) has announced that it will redeem its €350 million senior non-preferred bonds carrying a 10 per cent annual interest rate, bringing an early end to the landmark issuance that marked its entry into international debt capital markets.

The bank confirmed that it has obtained the necessary regulatory approval to redeem the notes in full on 6th December 2026, one year ahead of their scheduled maturity on 6th December 2027.

Bondholders will receive 100 per cent of their outstanding principal, together with accrued interest up to, but excluding, the redemption date.

The decision is significant because of the exceptionally high 10 per cent coupon attached to the bonds, which translates into approximately €35 million in annual interest payments on the original €350 million issuance.

By exercising its early redemption option, BOV stands to avoid a further year's worth of interest payments on these notes, although the overall financial benefit will depend on its replacement funding arrangements.

The bonds were originally issued in December 2022, marking BOV's first entry into the international debt capital markets.

At the time, the bank sought to strengthen its ability to meet regulatory requirements for eligible liabilities, while supporting the expansion of its lending portfolio and treasury investments.

The issuance attracted considerable investor interest, generating an order book of approximately €460 million, including around €230 million from domestic investors, before closing at €350 million.

The notes were rated BBB- by Fitch and carried a fixed annual coupon of 10 per cent, a notably high rate for bank debt.

According to the bank's latest financial update, the May issuance was twice oversubscribed and attracted participation from both domestic and international institutional investors.

BOV has reported a pre-tax profit of €189.6 million for the first nine months of 2026 this week, marginally below the €192.1 million recorded during the corresponding period last year.

Operating income increased by 6 per cent to €387.1 million, while net interest income rose by 10.6 per cent to €316.8 million.

The bank's total assets reached €17.8 billion, supported by growth in customer lending and deposits.

Following its performance during the first nine months, BOV raised the lower end of its full-year pre-tax profit forecast from €210 million to €230 million, while maintaining the upper end at €250 million.