THE CYPRUS construction industry holds the record for non-performing loans (NPLs) in Europe which, at the end of 2017, stood at 76.3% of total loans to the island’s construction sector and which remain a serious threat to the Cypriot banking system.
The disturbing statistics were published in a press release issued by the European Banking Authority (EBA) – Exposures to Real Estate activities and Construction.
The EBA figures also show the very progress Cyprus made in reducing construction NPLs in 2017 in percentage terms – at the end of Q1 2017 they stood at 74.4%, Q2 75.1%, Q3 73.8% and Q4 76.3% (€3.4 billion).
At the end of 2017 the average NPL ratio in the construction sectors of European Union member states stood at 21.1%.
NPLs related to real estate activities are even bleaker reaching 43.3% (€1.6 billion) at the end of 2017.
At the end of 2017 the average NPL ratio in real estate activities of the European Union member states stood at 5.3%.
Last month the European Commission, European Central Bank and the International Monetary Fund have called on Cyprus to tackle its non-performing loan problems following their recent post-programme surveillance (PPS) missions,