Cyprus’ non-performing loans drop to 9.5 per cent of total loans in 2022

Non-performing loans in Cyprus decreased to 9.5 per cent of total loans at the end of 2022, according to a report published this week by the Central Bank of Cyprus.

This marks a drop of 1.5 per cent when compared to 2021 when the NPE ratio stood at 11 per cent.

Total loans as of December 31, 2022, amounted to €24.36 billion, compared to €26.97 billion at the end of 2021.

Of these, €2.3 billion were non-performing loans, marking a decrease from the €2.96 billion in outstanding non-performing loans at end of 2021.

In addition, loans amounting to €2.73 billion were restructured, constituting 11.2 per cent of total loans, of which €1.01 billion continue to be non-performing.

According to CBC data, the total accumulated provisions for all credit institutions amount to €1.2 billion, with €1.09 billion relating to NPLs.

The total cumulative provisions for NPLs relative to total non-performing loans stood at 47.5 per cent at the end of 2022, up from 42.7 per cent at the end of 2021.

Of all loans, which amounted to €24.36 billion, €10.59 billion concern loans to households and €12.05 billion are loans to non-financial companies, of which €8,565 million concern small and medium enterprises (SMEs).

The NPL ratio for households is 12.1 per cent and for non-financial companies at 8 per cent, while for small and medium enterprises it stands at 9.7 per cent.

Aggregate data for all credit institutions with a reference date of December 31, 2022, does not include data related to RCB Bank, whose operating license was revoked in December 2022. This is the first time RCB Bank is not included in this report.

Compared to the third quarter of 2022, December recorded a decrease of €423 million or 15.5 per cent in total non-performing loans.

In addition, total loans decreased by 5.7 per cent, falling to €25.83 billion at the end of September 2022.

Moreover, the NPL ratio to total loans decreased from 10.6 per cent at the end of September 2022 to 9.5 per cent at the end of December 2022.