Rating agency Capital Intelligence recently revised its outlook for the Bank of Cyprus’ (BoC) Long-Term Foreign Currency Rating (LT FCR) and Bank Standalone Ratings (BSR) from stable to positive.
The LT FCR and ST FCR ratings for the Bank remain at ‘BB’ and ‘B’, respectively, according to the agency’s latest statement.
At the same time, CI Ratings reaffirmed the Bank’s BSR at ‘bb’, while the Capital Finance Strength (CFS) index has risen to ‘bb+’ from ‘bb’.
“The revision of the LT FCR and BSR outlooks to positive and the upward adjustment of the CFS index reflects the significantly improved net and operational profitability of the Bank and the reduced NPL ratio, combined with robust capital metrics in the third quarter of 2023,” the statement highlighted.
These factors, collectively, have fortified the bank’s ability to absorb credit losses and resilience, especially in the face of any potential adverse changes in the operational environment.
“The sound economic performance of Cyprus has contributed to improving the operational environment of banks regarding asset quality risks despite modest lending opportunities and profitability,” the agency noted.
Moreover, the operational and net profitability of the bank substantially improved during the first nine months of 2023, marking a return to positive figures from the low base in 2021.
“The high liquidity level in the form of cash has significantly benefited the net interest margin amid sharply higher interest rates and delayed deposit repricing,” the agency said.
“Effective cost management has contributed to improved profitability,” it added.
The statement also conveyed an expectation that healthy profitability will continue in 2024, although inflationary pressures on operational expenses might partially offset the short-term cost savings.
Regarding Non-Performing Loans (NPLs), it stated that NPLs have significantly decreased over the last three years due to sales and organic reductions via write-offs and collections.
Furthermore, it highlighted that REMU properties still constitute 4 per cent of the total assets in the third quarter of 2023, larger than the reported NPLs and equivalent to 42 per cent of total equity, which is considered substantial.
“While acknowledging the significant proceeds from continued property sales, we consider REMU properties as part of loan restructurings and, therefore, akin to NPLs. The Bank aims to halve the proportion of REMU properties by the end of 2025,” it concluded.
Central Bank of Cyprus (CBC) governor Constantinos Herodotou recently emphasised the need for enhanced financial literacy and education in Cyprus, noting that the national strategy seeking to remedy this issue would significantly boost citizens’ knowledge and understanding of financial matters.
Herodotou made these remarks in a written statement, highlighting the substantial deficiencies in Cypriot society concerning financial literacy.
The governor’s statement was prompted by the findings of the 3rd International Survey of Adult Financial Literacy conducted by the Organisation for Economic Cooperation and Development’s International Network on Financial Education.
For Cyprus, the survey results indicated that both financial and digital financial literacy levels were below the average of the participating countries.
Specifically, Cyprus scored 56 per cent in financial literacy compared to the 60 per cent average, and 44 per cent in digital financial literacy compared to the 53 per cent average.
The country’s financial literacy rating placed it seventh from the bottom among the 39 participating nations.
Herodotou stressed the importance of these findings, highlighting that a significant portion of adults worldwide lack basic financial comprehension and necessary skills for making sound financial decisions.
Moreover, he noted that this is particularly critical during periods of economic uncertainty, such as the current times marked by increasing cost of living and rising interest rates in many parts of the world.
A comprehensive report detailing the specific survey results for Cyprus is currently in progress.
In addition to adult results, the extensive report will include data for young people aged 15-17 and tailored questions specific to Cyprus, aiming to highlight the country’s peculiarities in financial literacy.
Cyprus this week commemorated 60 years since the adoption of the first Merchant Shipping Laws that laid the foundation for the creation of the Cyprus Registry, highlighting the country’s pivotal role in global maritime affairs.
Marina Hadjimanoli, the Deputy Minister of Shipping, noted that Cyprus’ high-standard registry is pivotal in the country’s prominent position on the global maritime map.
During an official dinner hosted by the Deputy Ministry in Limassol, attended by the President of the Republic, Hadjimanoli underscored the evolution of Cyprus’s maritime journey since the inception of ship registration in 1963 in Famagusta, relocated to Limassol after the 1974 Turkish invasion.
The Deputy Minister stated that amid challenging and unpredictable circumstances, the primary objective was always to elevate Cyprus to a leading role through a robust maritime sector.
Highlighting key milestones, Hadjimanoli mentioned the establishment of the Department of Merchant Shipping in 1977, the integration of ship inspectors and maritime officials, the setting up of shipping offices in strategically important international cities, Cyprus’ election to the International Maritime Organization Council in 1987, and its recent re-election.
Moreover, Cyprus’ accession to the European Union in 2004 modernised maritime legislation, aligning it with European standards and adopting an attractive taxation system for shipping.
Hadjimanoli stressed that Cyprus’s maritime growth was fueled by dedication and passion from professionals in the industry.
She praised the government’s bipartisan support for shipping, ensuring its distance from political disputes, emphasising that collective efforts yield substantial achievements.
Reiterating the government’s commitment to fortifying the Cyprus Registry, she highlighted that a robust registry amplifies Cyprus’s maritime strength and advertises the country’s capabilities effectively.
What is more, she extended gratitude to longstanding collaborators like the Cyprus Shipowners’ Union and the Cyprus Shipping Chamber, recognizing their vital role in enhancing and continuously improving Cyprus’ maritime sector.
Hadjimanoli concluded with a wish for the voice of Cyprus’s maritime industry to strengthen, bolster, and inspire future generations, ensuring the continued legacy of Cyprus as a global source of influence in the maritime sector.
The Cyprus Stock Exchange (CSE) ended Tuesday, December 19 with losses.
The general Cyprus Stock Market Index was at 134.68 points at 12:51 during the day, reflecting a decrease of 0.24 per cent over the previous day of trading.
The FTSE / CySE 20 Index was at 81.72 points, representing a drop of 0.27 per cent.
The total value of transactions came up to €107,658 until the aforementioned time during trading.
In terms of the sub-indexes, the main and alternative indexes fell by 0.39 per cent and 0.04 per cent respectively. The hotel index decreased by 0.26 per cent while the investment firm index remained stable.
The biggest investment interest was attracted by the Bank of Cyprus (+0.3 per cent), Hellenic Bank (-0.44 per cent), Atlantic Insurance (no change), Malloupas & Papacostas (no change), and Vassiliko Cement Works Public (no change).
