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Problem housing loans below 10 percent

Based on the preliminary results from the Bank of Cyprus, problematic housing loans account for just 9.4% of its non-performing loans of €12.7 billion and only 10.2% of its NPLs in Cyprus.

Bank of Cyprus problem housing loans below 10 percentBANK OF CYPRUS’ problematic housing loans account for approximately €1.2 billion (9.4%) of its total non-performing loans of €12.7 billion and just 10.2% of its non-performing loans in Cyprus.

According to the bank’s preliminary results, housing loans are its best performing category of loans as regards the level of non-performing loans.

At the end of last year housing loans totalled €4.4 billion accounting for 21% of the bank’s total loans in Cyprus, which amounted to €21.2 billion.

Non-performing loans in Cyprus for the other categories reported by the bank are considerably higher:

Corporate NPLs 61.4% (€6.2 billion)

SME NPLs 65.9% (€3.0 billion)

Retail (non-housing) NPLs 50.1% (€1.1 billion)

The Greek-language newspaper Politis, reported that 30 big debtors from 45 companies had non-performing loans amounting to €5.26 billion with the Bank of Cyprus; half of all the non-performing loans held by the bank.

The CEO of the Bank of Cyprus has said on numerous occasions that the bank would not pursue mass foreclosures on vulnerable members of society.

On Thursday, opposition parties once again voted to delay the suspension of the foreclosures legislation; this time until 19th March. However this time saying that the suspension was to allow them time to study and pass the five bills comprising the insolvency framework, which is seen as a safety net for distressed borrowers who have pledged their homes and businesses as collateral.

Readers' comments

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  • Shaun says:

    Thank you Nigel, your reply was helpful!

  • @Shaun on 2015/03/03 at 6:40 pm – Liquidators are already advertising properties for sale that have been purchased and paid for in full as the developer was forced into liquidation by the bank.

    Until a property is registered in the name of it’s purchaser, the vendor (the developer) remains its legal owner. This is due to the fact that the lunatics running the asylum are unable to issue Title Deeds on delivery of a property. The problem is compounded by developers who drag their heels and/or don’t repay their mortgages.

    Hopefully the foreclosures legislation and the insolvency framework will protect those who have bought and paid for their homes from having them seized. If the banks do start foreclosing on these properties, the property market here will never recover!

  • Shaun says:

    If a large percentage of NPLs belong to developers and if these developers are using properties, (which are fully paid for), as securities against these loans, then the passing of the legislation could mean the banks will pursue owners to retrieve theses loans. My understanding is that many of our properties remain in the name of the developers and are seen as assets on their balance sheets, even if there is no mortgage against them. Sorry if this has been asked before.

  • @nick on 2015/03/01 at 3:07 pm – I doubt that turkeys will appreciate your comment – they may decide to sue :-)

  • nick says:

    It will never be possible for Cyprus to soar like an eagle as long as its parliament is packed with a bunch of turkeys.

  • Stuart says:

    If you think you can hold your breath until 19 March, don’t.

  • Mike says:

    As Costas has pointed out by continuing “to delay the suspension of the foreclosures legislation” all they are doing is protecting themselves and their developer and Small and Medium sized business friends who owe the Country and its Banks Billions. I can only assume there is far too much work for lawyers to undertake to legally transfer assets to other entities and jurisdictions and to hide audit trails from forensic accountants. How they will transfer guarantor contracts to others may be proving problematic too. Perhaps that is why the bill needs delaying.

    It would be good if our Bankers, politicians and those seeking to cheat the country of its dues read and inwardly digest The Corporate and SME Workouts Manual of Best Practice published by the International Finance Corporation of the World Bank Group. It’s written as an “idiot guide” so even our politico’s should at least understand it. It may even help those who have an argument with the bank as it is written as a guide for lending institution staff primarily.

    The circus continues.

  • Costas Apacket says:

    We all know who the elite politicos are protecting by continually delaying the foreclosure legislation and it sure aint us.

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