MFSA proposes new proportionate rulebook for financial institutions

MFSA proposes revised rules for financial institutions

The Malta Financial Services Authority (MFSA) is seeking feedback on proposed changes to the rules governing financial institutions in Malta.

The consultation concerns a revised Chapter 2 of the Financial Institutions Rulebook (FIR/02), with comments being accepted until 6 November 2026.

The changes would apply to institutions licensed under Malta’s Financial Institutions Act, except payment service providers and electronic money institutions, which are subject to separate rules.

Rules tailored to financial institutions

A key part of the proposal is to reduce reliance on requirements originally designed for banks.

The MFSA wants the rules to better reflect the size, activities and risks of different financial institutions, rather than applying requirements that may not always be appropriate for their operations.

The proposed changes also aim to bring FIR/02 more closely in line with Malta’s wider financial regulatory framework.

The draft covers several areas, including corporate governance, outsourcing, regulatory reporting, audits, liquidity, capital requirements, ICT security, credit risk and complaints handling.

Industry invited to provide feedback

For affected firms, the proposed changes could mean adjustments to how they meet their regulatory obligations, particularly in areas where existing rules have been based on banking requirements.

Once the consultation is complete and the final rules are issued, the revised Chapter 2 is expected to replace the current version.

The MFSA is inviting licensed institutions, industry representatives and other interested parties to submit their comments by Friday, 6 November 2026.