Net new lending in Cyprus stood at €3.23 billion in 2022, reflecting a 10 per cent increase compared to the previous year, despite the uncertainty created by the war in Ukraine, according to a report released on Thursday by the Central Bank of Cyprus (CBC).

Net new loans granted by Cypriot banks exceeded the levels of 2019, when they had amounted to €3.2 billion.

They are also at the highest point since 2015, the year when the Central Bank of Cyprus began recording data on net new loans.

The year-on-year increase has been primarily attributed to the rise in corporate loans exceeding €1 million, with an increase of 28 per cent when compared to 2021.

In more detail, according to CBC data, new corporate loans over €1 million for 2022 amounted to €1.28 billion, up from €1 billion in 2021, and corresponded to 40 per cent of total new loans.

In its latest financial bulletin, the CBC explained that the increased demand for corporate loans, “possibly refers to increased financing needs for working capital, as the rise in energy costs and raw materials, as well as disruptions in supply chains, which have resulted in increased operating costs of businesses”.

The second largest share of new lending was mortgage loans, which amounted to €1.18 billion and corresponded to 36.4 per cent of total new loans.

Furthermore, compared to 2021, net new mortgages marked a slight decrease of 0.3 per cent.

The report noted that in 2021, the government interest rate subsidy plan for new housing was in force until the end of the year, something which affected the market.

Meanwhile, corporate loans up to €1 million saw a reduction of 1.6 per cent, amounting to €530.6 million in 2022, compared to €539 million during the previous year.

Moreover, corporate loans of up to €1 million corresponded to 16.4 per cent of all new loans.

New consumer loans amounted to €155.4 million, reflecting an increase of 4.15 per cent year-on-year and corresponding to 4.8 per cent of the total amount.

Finally, other loans not belonging to any of the aforementioned categories marked a decrease of 3.31 per cent year-on-year in 2022, with new loans amounting to €83 million compared to €124 million last year.