Cyprus Banks Beat EU Benchmarks As NPL Ratio Drops

by THEFUTURE.TEAM

February 18, 2026

The Central Bank of Cyprus has unveiled compelling improvements in the nation’s banking sector. As of December 31, 2025, the non-performing loans (NPL) ratio has fallen below the European Union average for the first time since 2014, marking a pivotal shift in asset quality management.

Asset Quality Convergence With European Peers

Excluding loans and advances to central banks and credit institutions, the NPL ratio declined sharply from 4.5% at the end of September 2025 to 3.2% by December. Under the European Banking Authority Risk Dashboard methodology, which incorporates these specialized exposures, the ratio likewise fell to 1.6% from 2.3%, reinforcing the sector’s progress toward aligning with EU standards.

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Strategic Adjustments And Provisioning Dynamics

Despite the overall improvement, the coverage ratio for non-performing loans with provisions dropped from 68.5% in September 2025 to 62.3% by December 2025. This adjustment reflects a recalibration in provisioning levels as banks streamline their balance sheets. Additionally, total restructured loans amounted to €0.8 billion by the end of December, with €0.3 billion remaining classified as non-performing, illustrating both the successes and ongoing challenges in asset management.

Implications For Sectoral Stability

This achievement is a significant milestone, indicative of the banking sector’s enhanced risk management practices and improved asset quality. By narrowing the gap with European peers, the CBC underscores a commitment to maintaining financial stability and bolstering investor confidence in the region’s banking system.

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Lithuania And Cyprus Forge Enhanced Partnership In Tourism And Defence

by THEFUTURE.TEAM

May 22, 2026

Expanding Cooperation Beyond The Surface

Kristupas Vaitiekūnas highlighted opportunities for closer cooperation between Lithuania and Cyprus during his visit to Nicosia for the informal ECOFIN meeting. Speaking to the Cyprus News Agency, the Lithuanian finance minister said both countries share common challenges and could expand collaboration in areas including tourism, defence and financial services.

Addressing Shared Challenges

Finance Minister Kristupas Vaitiekūnas said Lithuania and Cyprus face similar security and economic pressures despite their geographic differences. Particular attention was given to emerging security threats, including drone-related risks, alongside the importance of maintaining resilient financial sectors. According to Vaitiekūnas, stronger coordination in those areas could deliver long-term economic and strategic benefits for both countries.

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Focus On Fiscal Stability And Energy Security

Discussions at the ECOFIN meeting are expected to focus on Europe’s economic outlook, energy market volatility and fiscal stability. Kristupas Vaitiekūnas warned that instability in the Middle East could continue affecting oil markets and broader economic performance across Europe. Housing affordability was also identified as a growing challenge, with rising property prices in cities such as Vilnius reflecting broader pressures seen across European markets.

Coordinated Energy Strategy And Future Investments

The Lithuanian finance minister also called for a more coordinated European approach to energy and economic resilience. Vaitiekūnas suggested that targeted and temporary policy measures could prove more effective than large-scale structural reforms in addressing short-term pressures. Lithuania continues to increase investment in renewable energy generation and storage infrastructure as part of efforts to strengthen energy independence and begin producing surplus electricity by 2028.

Support For Ukraine And Enhancing Defence Funding

Finance Minister Kristupas Vaitiekūnas reaffirmed Lithuania’s support for Ukraine, describing the war as a broader struggle tied to European security and democratic values. He also backed accelerating Ukraine’s accession process to the European Union, arguing that deeper integration would strengthen regional stability and economic prosperity. Vaitiekūnas welcomed the EU’s SAFE programme, which is expected to support Lithuania’s defence capabilities while contributing additional assistance to Ukraine.

Looking Ahead To A More Unified Europe

Addressing the European Union’s future budget framework, Kristupas Vaitiekūnas said increased funding for security and defence represented a positive development. At the same time, he warned that reductions in cohesion funding and agricultural support could negatively affect purchasing power and long-term European unity. Lithuania is expected to place continued emphasis on Ukraine and regional security ahead of its upcoming EU Council Presidency in early 2027.

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