Non-Performing Loans in Cyprus Remain Stable Despite Inflation

The stock of non-performing loans in the Cypriot banking system remains stable, according to the Central Bank, confirming forecasts that rising inflation is not affecting debt servicing by households and businesses.

Data shows that the value of problem loans overdue by more than three months has remained stable since 2024. At the end of May 2025, the non-performing loan (NPL) ratio remained at 5.9%, while the coverage ratio of NPLs with impairment provisions increased to 61.0%.

Total restructured loans amounted to €1.3 billion, of which €0.7 billion are still included in NPLs. Of the €25.4 billion in loans, loans overdue by more than 90 days amount to €1.16 billion, and total non-performing loans amount to €1.49 billion.

The change in the picture since 2019 is significant, when total loans were €32.10 billion, loans overdue by more than 90 days were €7.42 billion, non-performing loans were €8.97 billion, and restructured loans were €5.45 billion.

The Central Bank points out that progress in reducing problem loans is uneven, with smaller institutions facing greater difficulties. The coverage ratios of the Cypriot banking sector for NPLs are comparable to those of EU countries.