Cyprus Leverages European B2B Platform And Strategic Funding To Bolster Its Defense Industry

by THEFUTURE.TEAM

September 30, 2025

Cyprus is poised to accelerate the evolution of its defense industry by harnessing two pivotal initiatives—a robust European B2B platform and groundbreaking financial instruments—designed to drive innovation and reinforce national security.

Connecting With The European Defense Ecosystem

The Ministry of Defense has underscored the importance of the European Defense Agency’s B2B platform. This state-of-the-art network links domestic defense companies with a broad ecosystem of EU member states, facilitating the identification of collaborative opportunities in projects and funding initiatives, including the European Defence Fund (EDF). Such initiatives not only enhance interconnectivity but also provide a strategic conduit for enterprise expansion in critical defense sectors.

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Ensuring Compliance And Operational Excellence

The platform maintains strict eligibility criteria, welcoming only those industries and research institutions established within the EU and operating free from external control in sensitive areas such as intellectual property rights, supply chain integrity, and export controls. By enforcing these rigorous standards, the initiative ensures that all participants are well-equipped to engage in high-level defense collaborations.

Harnessing SAFE Funding For Strategic Growth

In parallel, the government is actively leveraging the new European SAFE funding tool to invigorate the Cypriot defense sector. This strategic move aims to create employment opportunities, attract investment, and enhance national deterrence capabilities. Nicosia has meticulously evaluated the data provided by SAFE, with plans underway to spur domestic production of critical assets—including drones, personnel carriers, sophisticated software, and advanced communication systems. Moreover, the program paves the way for joint procurements with other EU nations and grants access to U.S. military technologies.

Strategic Investments And Future Prospects

Former President Nikos Christodoulides has indicated that the EU-approved €150 billion package, in concert with U.S. military equipment provisions, will shape forthcoming decisions regarding defense infrastructure investments. With a focus on key bases such as Andreas Papandreou and Evangelos Florakis, final deliberations on equipment and support infrastructures are imminent.

Enhancing Global Partnerships Through Local Innovation

Furthermore, the first session of the Council of Defense Industry has set the framework for integrating Cypriot companies into national defense initiatives. Minister of Defense Vasilis Palmas has emphasized that local enterprises are already capable of producing critical defense products. By aligning with foreign firms through strategic ventures modeled on successful international practices, Cyprus is primed to contribute significantly to the EU’s overarching strategy for reinforcing defense production and capability.

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Bank of Cyprus Upgrade Signals Fresh Optimism For Greek And Cypriot Banks

by THEFUTURE.TEAM

June 26, 2026

Regional Banks Enter A More Favorable Cycle

Bank of Cyprus and Eurobank are well positioned to benefit from a renewed re-rating of Greek and Cypriot bank stocks, according to Cyprus-based investment firm Roemer Capital, which upgraded Bank of Cyprus to a buy rating and reaffirmed its positive view on Eurobank.

The firm cited easing geopolitical tensions, resilient economic growth in Greece and Cyprus, lower funding costs and Greece’s expected transition to developed-market status as the main factors supporting the sector.

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Roemer Capital also lowered its cost of equity assumptions, updated its forecasts following first-quarter 2026 results and extended its valuation horizon to the end of 2027, raising target prices across its banking coverage.

Bank Of Cyprus Gets The Largest Upgrade

Bank of Cyprus received the biggest revision, with Roemer Capital upgrading the stock from hold to buy and setting a target price of €11.10, implying potential total upside of 27%.

The firm highlighted the bank’s strong capital generation, profitability and projected 100% dividend payout, describing it as the strongest capital-return story among the banks under coverage. Roemer Capital maintained its buy rating on Eurobank, assigning a target price of €4.90 and forecasting potential upside of 28%. The report said the bank is well placed to benefit from loan growth, improving operating performance and merger-and-acquisition synergies.

National Bank of Greece and Piraeus Bank also retained buy ratings, with expected returns ranging from 25% to 36%. Optima Bank was upgraded to buy, while Alpha Bank remained at hold on valuation grounds.

Why Growth Still Sets The Region Apart

According to Roemer Capital, Greek and Cypriot banks continue to benefit from stronger economic fundamentals than many western European peers. The report pointed to faster economic growth, healthier balance sheets, low levels of non-performing exposures, capital ratios approaching 20% and strong customer deposit bases.

Analysts expect performing loans across the sector to grow at a compound annual rate of 6% to 8% through 2028, supported by private investment, digitalisation, green manufacturing, supply-chain expansion and a gradual recovery in household lending.

The report also said the conclusion of lending under the EU Recovery and Resilience Facility is unlikely to materially affect credit growth, as banks have already shifted back towards traditional commercial lending. Roemer Capital expects Euribor to remain between 2.2% and 2.5%, a level it believes should support both lending activity and net interest margins.

Geopolitics, Valuation And Market Structure Support The Case

The report said improving geopolitical conditions have strengthened the investment outlook, noting that Brent crude prices have largely returned to pre-war levels while Greek government bond yields have stabilised at around 3.5%. Although geopolitical risks remain, Roemer Capital believes the likelihood of a major inflationary shock or significant pressure on bank profitability has eased.

Another important catalyst identified by the firm is Greece’s expected promotion to developed-market status by FTSE Russell, STOXX and MSCI over the coming months.

According to the report, the reclassification should improve liquidity and attract a broader base of international investors. Roemer Capital also said Euronext’s acquisition of the Athens Exchange is expected to strengthen market infrastructure and increase international visibility, particularly for Bank of Cyprus and Optima Bank.

The firm noted that Bank of Cyprus has already benefited from its Athens listing, with average daily trading value increasing from less than €400,000 before its September 2024 move to nearly €6 million afterwards.

Economic Momentum Remains A Core Tailwind

Roemer Capital said both Greece and Cyprus have moved beyond post-crisis recovery and are now supported by private-sector-led growth. For Cyprus, the report highlighted recent tax reform and efforts to simplify the legal and regulatory framework, while also noting that limited foreign banking competition continues to support domestic lenders.

Overall, Roemer Capital expects Greek and Cypriot banks to remain well-positioned for profitable loan growth over the coming years.

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