Cyprus Mail

Volume of new loans highest since 2013

Moody’s rating agency said it expects the volume of new loans in Cyprus in 2017 to be the highest since 2013, pointing out that an increase while maintaining strong underwriting standards and best practices, will be credit positive for banks.

The rating agency cites the quarterly bank lending survey issued last Tuesday by the Central Bank of Cyprus, which forecast increased loan demand in third quarter 2017, mainly in mortgage and business loans.

The increase is being driven by accelerating economic growth, an improving labour market that increased business and consumer confidence and a gradual recovery of the property market, the bank said.

Building permits issued in the first four months of 2017 reached the highest level since the 2013 banking crisis.

It also notes that the banks expect demand for loans by non-financial corporates and mortgage borrowers to increase in the third quarter of this year, and expect that lending standards, which tightened in 2014 and remained stable since, will not change.

“We expect the volume of new loans this year to be the highest since 2013,” Moody’s said.

New loans excluding debt restructurings totalled €1.6bn in the first six months of 2017, or 67 per cent of new loan volume for the entire 2016.

“The increase in new lending will support banks’ net interest income and curtail declining pre-provision profit and contracting loan books from write-offs of bad debts,” it added, noting also that higher revenues will support banks’ capacity to further improve their balance sheet by writing off bad loans.


Related Posts

Jab status, age no predictor of long Covid

Antigoni Pitta

No quick fix as protesting pensioners battle government indifference

CM: Our View

OPEC+ agrees deep cuts to oil production despite US pressure

Reuters News Service

Second arrest in connection with attempted murder

Antigoni Pitta

Herbs recalled after failure to list potential allergen

Antigoni Pitta

New divorce laws in place by Christmas

Antigoni Pitta


Comments are closed.