Cypriot household debt 77 per cent of GDP, corporate debt ratio twice as high

The household debt ratio in Cyprus stood at 77 per cent of GDP at the end of the third quarter of 2022, marking a slight decrease compared to the previous quarter, according to a report released this week by the Central Bank of Cyprus (CBC).

The central bank primarily attributed the ratio’s decline to an increase in Cyprus’ GDP during the applicable period.

In addition, during the same period, the debt ratio for non-financial corporations stood at 150 per cent of GDP.

Cypriot household assets in financial instruments amounted to €58.6 billion at the end of September 2022, of which 61 per cent concerns cash, deposits and loans, 2 per cent concerns securities, 20 per cent shares, and 18 per cent concerns other financial assets.

Moreover, household debt stood at €20.1 billion at the end of September 2022, with the debt ratio standing at 77 per cent of Gross Domestic Product (GDP), marking a small decrease compared to the previous quarter due to the increase in GDP.

The central bank noted that compared to December 2016, Cyprus’ household debt index has experienced a noticeable decrease, with a drop of approximately 39 per cent.

The corresponding assets of non-financial companies amounted to €66.6 billion, with a ratio of 18 per cent in cash and deposits, 4 per cent in loans, 0.3 per cent in securities, 47 per cent in shares and 31 per cent in other financial assets.

The sector’s debt at the end of September 2022 stood at €39.3 billion with the debt ratio at 150 per cent of GDP, down 8 per cent from the previous quarter, mainly due to GDP growth.

Compared to December 2016, the debt index of non-financial companies reflects a noticeable drop of approximately 61 per cent.

Furthermore, insurance company assets, in terms of purely financial instruments, amounted to €4.3 billion, of which 12 per cent in cash and deposits, 3 per cent in loans, 22 per cent in securities, 46 per cent in shares and 18 per cent in other financial assets.

Accordingly, investment institutions have assets worth a total of €7.7 billion in financial instruments, 5 per cent of which is invested in cash and deposits, 13 per cent in loans and securities, 79 per cent in shares and 2 per cent in other financial assets.

Finally, pension fund investments in financial instruments amounted to €3.8 billion euros and mainly concern cash and deposits at a rate of 24 per cent, 16 per cent in loans, 3 per cent in securities, 44 per cent in shares and 13 per cent in other financial assets.