Filenews 14 December 2023
Total non-performing loans (NPLs) in the Cyprus banking system at end-September 2023 declined further to €2.02 billion compared to €2.08 billion at the end of August. Compared to the previous quarter ended at the end of June, NPEs decreased by €95m.
According to data released by the Central Bank, total lending declined to €24,365 million, following a continued quarterly downward trend. Non-performing loans amounted to €2,017 million, with the NPE ratio decreasing to 8.3%, compared to 8.7% in June 2023.
The NPE coverage ratio with bad provisions remained essentially at the same level at 50.3% at end-September 2023 compared to 50.4% or €1.1 billion at end-June 2023.
Loans with arrears of more than 90 days decreased by €80 million, amounting to €1.58 billion at the end of September from €1.66 billion at the end of August, and accounted for 6.5% of total loans.
According to the CBC, the continued downward trend of NPEs in the third quarter of 2023 is mainly due to write-offs of loans carried out in the context of restructurings or to non-contractual or "accounting" write-offs against amounts already included in provisions as well as loan repayments, including debt-to-asset swaps (real estate). The decrease is also due to loans that have been successfully restructured and reclassified as performing loans after the end of the surveillance/monitoring period.
Total loans by Licensed Credit Institutions until the end of September 2023 that benefited from restructuring amounted to €1.86 billion, from €1.92 billion in the previous month and accounted for 7.7% of total loans. Restructured loans, which continue to be classified as non-performing, declined to €916m. in September against €950 mil. in the previous quarter.
Household NPEs in September decreased to €1.12 billion. compared to €1.18 billion. in August and accounted for 10.6% of total household loans. Total provisions for household NPEs stood at 36.8%.
Business NPLs amounted to €0.86 billion. remaining stable compared to the previous month and accounting for 7.2% of total business loans. Total provisions for business NPLs amounted to 66.4%.
