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Non-performing loans at €29 billion

Non-performing loans (NPLs) in the Cypriot banking system continued their upward trend in July reaching €28.88 billion; 47.17 per cent of the total amount of loans according to the island’s Central Bank.

non-performing loansNON-PERFORMING loans (NPLs), the bane of the Cypriot banking system, continued to rise in July, recording an increase of approximately €130 million by the end of the month, compared with the previous month of June, according to data released yesterday by the Central Bank of Cyprus (CBC).

The data release marked the first time the CBC published a single aggregation for banks and co-operative credit institutions.

According to the data, despite a reduction in the total amount of loans compared to the previous month, NPLs in the Cypriot banking system on July 31, 2014, reached 47.17 per cent (accounting for €28.88 billion) of total loans, standing at €61.24 billion.

This marked an increase from June’s figures when NPLs stood at 46.75 per cent (€28.75 billion) of total loans, which amounted to €61.50 billion.

Businesses loans rose in July to €33.81 billion, of which 49.05 per cent were classified as NPLs, compared with 48.81 per cent the previous month.

Loans to individuals and households in July amounted to €25.05 billion, of which 49.09 per cent were NPLs, compared with 48.68 per cent in June.

The construction sector continued to be the sector with the most NPLs in July, with 71.91 per cent of total loans to the sector (€7.68 billion) characterised as non-performing. This registers a slight change from the previous month when 71.74 per cent of total loans (€7.66 billion) were NPLs.

NPLs in the real estate sector, representing a significant part of business loans, decreased from 54.54 per cent in June to 52.87 per cent the following month. Total loans to the sector reached €5.28 billion in July, compared with €5.21 billion the previous month.

Regarding housing loans, NPLs hovered around the same mark, with 42.67 per cent of €14.76 billion in total loans classified as non-performing in July, compared with 42.52 per cent the previous month.

Consumer loans rose slightly in July to €7.41 billion, of which 59.46 per cent were NPLs, compared with 58.63 per cent of €7.40 billion recorded as NPLs in June.

Further reading

Non-performing loans July 2014 (Central Bank of Cyprus)

Readers' comments

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  • Stuart says:

    With NPLs heading relentlessly towards €30 billion this year, it’s easy to see why the Troika is withholding further tranches of the €10 billion bail-out until the Cyprus authorities start to get a grip by adopting some satisfactory legislation which will begin to reel in some of this vast level of indebtedness.

    Some people would say that if this degree of recklessness and defiance continues, Cyprus should be expelled from the EU as it is becoming clearly apparent it was never a suitable candidate for admission in the first place. However, sustaining the EU’s ridiculous Eurozone at any price seems to take priority over any financial common sense.

  • Mike says:

    Hmmm! Nearly half of all loans issued not being repaid (NPLs), unemployment on the rise, wages other than in the public sector falling, Public sector bloated salaries and pensions ring-fenced and protected together with all manner of non contributory perks increasing, property sector decimated to the point of extinction yet still talking in millions, tourism just about bought back from the brink but still fragile, the political elite desperately attempting to mitigate troika demands in order to maintain a pitifully lacking economy and whole communities desperately frightened for the future. What does that all add up to and what does it indicate for the future – other than business as usual of course?

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