Deposits held with Cyprus financial institutions increased by a net €562.3 million in July, while total loans declined by €68.7m, according to figures released by the Central Bank of Cyprus (CBC).

The rise in deposits was largely driven by Cyprus residents, whose holdings increased by €603.2m during the month.

More specifically, household deposits rose by €195.7m, while those held by non-financial corporations increased by €257.1m. Deposits belonging to other domestic sectors grew by a further €150.4m.

Consequently, the outstanding balance of total deposits reached €59.2 billion at the end of July, more than double the corresponding balance of loans.

At the same time, the annual growth rate of deposits accelerated to 6.2 per cent, up from 5 per cent in June.

However, despite the strong monthly inflow, the increase was slightly lower than the net rise of €601.2m recorded during the previous month.

By contrast, total loans recorded a net decrease of €68.7m in July, reversing the €499.4m increase registered in June.

The decline was mainly attributed to €90m in loan repayments by residents of other euro-area member states.

Loans to Cyprus residents, however, recorded a small net increase of €1.8m, reflecting different trends among households and businesses.

In particular, household borrowing increased by €65.7m, while loans to non-financial corporations decreased by €79.6m. Lending to other domestic sectors rose by a combined €15.8m, partly offsetting the decline in business loans.

Following these changes, the outstanding balance of total loans stood at €28.3bn at the end of July.

Meanwhile, the annual growth rate of lending remained strong but eased to 11.1 per cent, compared with 11.6 per cent in June.