The Central Bank of Cyprus has published a revised, user-friendly set of selected financial soundness indicators for the Cypriot banking sector covering 2024, pointing to stronger capital and leverage positions, continued excess liquidity and positive profitability, while noting that non-performing loans on banks’ balance sheets remain significant. Capital adequacy and leverage ratios improved significantly compared with end-2023. Asset quality continued to strengthen, but the non-performing exposure ratio remained above the European Union average of around 2.5%, with high provisioning coverage presented as a buffer against potential future credit losses. Profitability was positive and mainly driven by net interest income from loans, investments in debt securities and deposits with the European Central Bank, while operating expenses rose slightly compared with 2023 due to higher personnel costs. Liquidity ratios remained well above the 100% supervisory minimum, and sector assets were concentrated in cash and deposits with the European Central Bank, loans and bonds, funded largely by deposits and capital.
Central Bank of Cyprus 2025-05-19
Central Bank of Cyprus publishes revised 2024 financial soundness indicators for the Cypriot banking sector
The Central Bank of Cyprus released updated 2024 financial soundness indicators, highlighting improved capital adequacy, leverage ratios, excess liquidity, and positive profitability in the banking sector. Despite strengthened asset quality, non-performing loans remain significant, with the non-performing exposure ratio above the EU average. Profitability was driven by net interest income, while operating expenses increased due to higher personnel costs.