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Liquidity in the Cyprus banking system rises to almost €29 billion in August

by THEFUTURE.TEAM

Liquidity in the Cyprus banking system (the difference between deposits and loans) rose to €28.7 billion in August 2024, driven by the rise in deposits in combination with the reduction in the outstanding balance of loans in the system, data released by the Central Bank of Cyprus (CBC) show.

According to the CBC, total deposits in August 2024 recorded a net increase (excluding the changes resulting from reclassifications, exchange rate and other adjustments) of €288.5 million, compared with a net increase of €164.7 million the month before.

The annual growth rate of total deposits rose to 3.8%, compared with 2.9% in July 2024. The outstanding amount of total deposits reached €53.6 billion in August 2024, the CBC added.

The rise in deposits was driven by the increase in savings by Cyprus residents, which amounted to €194.2 million. Deposits of households and non-financial corporations increased by €34.6 million and €46.8 million respectively, whereas deposits of the remaining domestic sectors exhibited a total increase οf €112.8 million.

Loans down by €75 million

Total loans in August 2024 recorded a net decrease of €74.9 million, compared with a net decrease of €7.2 million in July 2024.

The annual growth rate (compared with August 2023) stood at 1.7%, compared with 2.0% in July 2024. The outstanding amount of total loans reached €24.9 billion in August 2024.

Loans to Cyprus residents exhibited a decrease of €72.2 million.

Loans to households and non-financial corporations decreased by €25.8 million and €53.6 million respectively. Loans to the remaining domestic sectors exhibited a total increase of €7.2 million, the CBC said.

The remaining domestic sectors include investment funds, other financial intermediaries, financial auxiliaries, captive financial institutions and money lenders, insurance corporations and pension funds and general government.

Interest rates on housing loans up and down on deposits

by THEFUTURE.TEAM

Cypriot banks raised mortgage rates in August while cutting interest on one-year deposits for households, according to data released by the Central Bank of Cyprus (CBC).

Meanwhile, the total value of new loans dropped sharply in August, falling by 33 per cent compared to July.

The latest figures, published on Wednesday reveal that the interest rate for short-term deposits by households fell to 1.79 per cent, from 1.96 per cent in July. In contrast, the deposit rate for businesses (non-financial companies) travelled in the opposite direction up to 2.33 per cent in August from 2.28 per cent in the previous month.

Consumer loan rates also saw a small decline, dropping to 6.59 per cent from 6.67 per cent in the previous month. Mortgage rates rose marginally to 4.65 per cent, from 4.59 per cent.

Rates for businesses, on loans €1 million also fell to 5.36 per cent from 5.61 per cent. For loans

above €1 million the rate fell to 5.42 per cent from 5.64 per cent.

In terms of new loans, there was a marked drop across the board. Total new loans fell to €395.5 million, down from €596.3 million in July.

Consumer loans also fell with net new loans at €19m, compared to July’s €28m (€26.1m net).

Loans for house purchases also declined significantly, falling to €95.6m, of which €72.3m were net new loans, down from €134.3m (€100.7m net) in July.

New loans of under a million euro to businesses decreased to €52.8m (€34.1m net), down from €75.5m in July (€49.5m net).

Similarly, loans of over a million euros were halved to €179.3m (€78.3m net), compared to €345.2m (€211.8m net) in the previous month.

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