A lot of investment has been undertaken for touristic development ranging from hotels to quality places of entertainment and even more important addressing the upgrading of staff, food and service. Previous years with the tourist arrivals have been increasing by approximately 8% p.a. and this, coupled with the planning relaxation given by the then Government, … Read more
Complaints to the financial ombudsman’s office rose by 20 per cent in 2023 to a total of 1,121.
Cyprus witnessed a rise in consumer loan interest rates in March of this year, alongside a decrease in rates for housing loans, while household deposit rates saw an increase, according to a report released by the Central Bank of Cyprus. In the same month, the total amount of new loans decreased by €79 million compared to the previous month.
In March, consumer loan rates increased while mortgage rates decreased in Cyprus. Deposit rates for households also rose, with new lending decreasing by €79 million compared to the previous month. The interest rate for fixed-term deposits for households increased to 2.24%, while the interest rate for non-financial corporations decreased to the same percentage. Total new loans in March amounted to €496.4 million, with new consumer loans decreasing to €22.2 million and new housing loans decreasing to €119.6 million. New loans to non-financial corporations for amounts up to €1 million increased, while loans for amounts above €1 million decreased. These statistics were published in the April 2024 edition of ‘Monetary and Financial Statistics’ by the Central Bank of Cyprus.
By end-February 2024, the government had accumulated cash deposits of over €3.5 billion at the Central Bank and €2.1 billion at commercial banks.
The newly appointed governor of the Central Bank of Cyprus, Christodoulos Patsalides, has expressed dissatisfaction with the interest rate disparity between lending and deposit rates in Cyprus.
Christodoulos Patsalides was appointed as the new Central Bank Governor of Cyprus, replacing Constandinos Herodotou. Patsalides, a former deputy CEO of the Bank of Cyprus, was sworn in just in time to attend the ECB monetary policy meeting in Frankfurt.
By December 2023, interest rates on Cyprus bank loans for house purchases had reached an average of 5.1%, compared with the average rate of 3.8% for other euro area countries. The average interest rate on Cyprus bank loans to corporations was 5.7% in December 2023, exceeding the euro area average of 5.1%. Cyprus banks had increased their profits by 600% to over €1.1 billion in 2023. The interest income of the two largest banks increased by €830 million between 2022 and 2023, mainly due to higher interest receipts from the ECB. Cyprus banks deposited around 35% of their assets at the ECB, earning from 2% to 4% in interest in 2023. Cyprus banks offered an average interest rate of 2.06% on fixed term deposits in January 2024, compared with an average deposit rate of 3.21% in the euro area. The net interest margins for Cyprus banks exceeded three percentage points, while the average for the euro area was just over one percentage point. The Bank of Cyprus announced that €112 million of their after-tax profit of €487 million would be distributed as cash dividends to shareholders, with a share buyback of up to €25 million.
The European Central Bank has decided to keep interest rates unchanged at 4% for the third consecutive meeting. The bank is focused on bringing inflation down to 2% and is committed to maintaining interest rates at their current levels for a long duration. Investors are advised to pay attention to the ECB’s messaging and not be swayed by market hype and speculation. The decision to hold interest rates steady is part of a broader global context where central banks are closely monitoring economic indicators and working towards economic stability.