The prime considerations while deciding on the likely approach included the cost of implementation and the cost of compliance. Before coming to specifics I may like to mention that overall capital is what makes financial systems stable. In general, expected losses are to be covered by earnings and provision and hence the need to price risk appropriately.
Malta will also benefit from the stability oriented policy of the ECB, which will help anchor inflation expectations. Furthermore, as Malta is a small open economy, adopting the euro provides protection against international financial disturbances, which often have a disproportional effect on smaller economies. I should underline, however, that these benefits do not come automatically.