German fintech powerhouse RS2 has formally entered the race to acquire HSBC Malta, pledging to resurrect the iconic Mid-Med Bank brand if its bid proves successful.
The company confirmed to Times of Malta that it had been invited to submit a bid for HSBC Malta, becoming the fourth known contender in the acquisition process that began last September when HSBC announced its possible departure from the Maltese market.
“We’ve secured the Mid-Med brand and intend to revive it,” a company spokesperson said, describing the move as bringing back a “homegrown champion with European aspirations”. The Mid-Med Bank name and its distinctive blue and white branding were phased out following HSBC’s takeover in 1999.
RS2’s proposal includes commitments to maintain HSBC Malta’s entire workforce and infrastructure. “Our business plan commits to retaining all employees, branch and ATM infrastructure,” the spokesperson emphasised. “Our aim is to increase, not decrease operations.”
While the company has not disclosed how it will finance the acquisition, it insists that “financing for a competitive bid is already in place”.
The German fintech is no stranger to Malta, having maintained operations on the island for three decades. It currently employs approximately 200 people between its Mosta headquarters and Gozo office. The company is listed on the Malta Stock Exchange, though its share price has declined significantly in recent years, falling from €2.40 in July 2020 to just €0.38 this month.
RS2 has established itself as a significant player in the payment processing sector, with an impressive client portfolio including Worldpay, SumUp, Swedbank, Banca Intesa, and Barclays. The latter is believed to hold an 18% stake in the group, raising the possibility of Barclays making an indirect return to Malta after exiting the country over a decade ago.
The company currently holds an e-money licence issued by Germany’s financial regulator BaFin but would need to secure a full banking licence to complete the takeover. RS2 appears confident about regulatory approval, stating that initial discussions with the Malta Financial Services Authority had yielded “positive feedback”.
RS2’s bid follows APS Bank’s withdrawal from the race last week. APS, previously considered a frontrunner, cited “confidential information external to the due diligence exercise” as the reason for its departure.
The remaining contenders include Hungarian banking giant OTP and a local consortium of businesses. OTP’s involvement has raised concerns due to its continued operations in Russia following the invasion of Ukraine.
Any successful bid must receive approval from both the Malta Financial Services Authority and the European Central Bank, given HSBC Malta’s status as one of the country’s three systemically important banks.
HSBC Malta reported pre-tax profits of €154.5 million last year, representing a significant acquisition target. The Finance Minister has previously warned that the takeover process cannot “take forever”, indicating government interest in seeing a swift conclusion to the matter.
