Interest rates in Cyprus experienced a general decline in November 2024, mirroring recent rate reductions by the European Central Bank (ECB), according to data from the Central Bank of Cyprus (CBC). However, disparities persist among local financial institutions, with Cyprus continuing to report borrowing rates above and deposit rates below the Eurozone average.

Mortgage Lending: Small Gains For Borrowers

In the mortgage market, the average variable interest rate for home purchases in Cyprus edged down to 4.50% in November from 4.62% in October. Comparatively, the Eurozone average fell to 4.27% from 4.37%. Rates for new variable loans varied widely among Cypriot banks. The Bank of Cyprus recorded the highest rate at 5.20%, followed by Astrobank at 4.85% and Eurobank Cyprus at 4.54%. On the lower end, the Housing Finance Corporation offered 3.53%, and Ancoria Bank provided 3.78%. For renegotiated loans, rates were notably divergent, with the Bank of Cyprus at 5.48% and Eurobank Cyprus offering a significantly lower rate of 2.35%.

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Corporate Loans: Mixed Trends Across Loan Sizes

For corporate loans under €1 million, average rates fell to 5.01% in November from 5.45% in October, while the Eurozone average dipped to 4.74%. Among Cypriot banks, Banque SBA led with the highest rate at 7.54%, while Hellenic Bank and Ancoria Bank offered the lowest rates at 4.55% and 4.35%, respectively. In renegotiations, Hellenic Bank stood out with a rate of 3.42%, the lowest in this category.

Conversely, loans above €1 million saw an increase in rates. The average rate in Cyprus rose to 4.97% from 4.72%, diverging from the Eurozone, where rates decreased to 4.38%. Banque SBA recorded the highest rate at 7.52%, with Hellenic Bank at 6.55%. Lower rates were observed at the Bank of Cyprus (5.07%) and Societe Generale Bank Cyprus (5.15%). For renegotiated large loans, Hellenic Bank offered the lowest rate at 3.29%, down from 4.40% in October.

Deposit Rates: A Steady Decline

Household deposit rates for term deposits up to one year dropped to 1.70% in November, down from 1.76% in October and 1.98% in September. The Eurozone average also fell, landing at 2.61% from 2.74%. Arab Jordan Investment Bank provided the highest household deposit rate at 3%, while the Bank of Cyprus and Hellenic Bank offered the lowest at 0.72% and 1.50%, respectively.

Corporate deposit rates saw a similar downward trend, with one-year term deposits averaging 1.99% in November, down from 2.19% in October. The Eurozone average remained higher at 2.90%. Astrobank led with the highest rate at 2.92%, followed by the National Bank of Greece at 2.54%. Meanwhile, the Housing Finance Corporation reported the lowest rate at 0.22%, alongside the Cyprus Development Bank, which offered 1.59%.

While the ECB’s monetary policy adjustments continue to influence Cyprus’ interest rates, the disparity between local and Eurozone averages highlights ongoing structural challenges. Borrowers and savers alike will need to navigate the