Non-performing loans fall in Cypriot banks

Source: Xinhua| 2018-08-10 20:15:02|Editor: Shi Yinglun
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NICOSIA, Aug. 10 (Xinhua) -- Non-performing loans (NPLs), the most serious after effect of the 2013 bail-out of Cyprus, fell by 3.1 percentage points at the end of April, on a year-on-year basis, the Central Bank of Cyprus (CBC) said in a statement on Friday.

It said that non-performing loans stood at 19.916 billion euros, or 42.9 percent of the total loan portfolios of all banks compared with 23.158 billion euros at the end of April 2017, or 46.0 percent of total loans.

The CBC said NPLs amounting to 8.273 billion euros are actually loans which have been restructured but are listed as non-performing for a period of 12 months in line with EU regulations.

Banks are obliged to make provisions for both bad loans and those which have been restructured for the entire 12-month probation period, burdening their balances by more than one-third of their total provisions.

In an indication of the extent to which households are indebted to banks, CBC said they had the biggest share of NPLs, amounting to 10.8 billion euros, relative to the debts of business corporations which stand at 8.83 billion euros.

NPLs soared to 27.328 billion euros, or over 52 percent of the total loan portfolios of the banks at the height of the economic and banking crisis at the end of 2014.

Finance Minister Harris Georgiades told a television station that he was more than confident that the problem of non-performing loans will be brought down to manageable levels as soon as the economy grows and banks will be able to take advantage of legal tools given to them to deal with strategic defaulters.   

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