A further decline in non-performing loans (NPLs) was recorded at the end of July, according to data published on Thursday by the Central Bank of Cyprus (CBC).

As of 31 July 2025, the ratio of non-performing exposures (NPEs) to total loans fell to 5.5%, down from 5.6% at the end of June and 6.2% at the end of 2024.

The total stock of NPLs stood at €1.44 billion, marking a small decrease from €1.46 billion in June and a notable drop on an annual basis.

At the same time, total loans increased slightly to €26.0 billion, compared to €25.8 billion in June — a development that also contributed to the improvement of the overall NPL ratio.

Loans with delays exceeding 90 days remained stable at €1.15 billion, representing 4.4% of total loans. This stability indicates a continued improvement in the quality of the loan portfolio within the banking system.

Cumulative provisions held by banks reached €982 million, of which €895 million were allocated to non-performing exposures. The coverage ratio of NPEs increased slightly to 62.2%, up from 62.0% in June and 59.9% at the end of 2024.
This improvement suggests that Cypriot credit institutions maintain a strong buffer against potential credit losses.

The largest share of non-performing loans continues to be concentrated among households and small and medium-sized enterprises (SMEs).

Specifically, households recorded an NPL ratio of 7.4%, corresponding to €794 million in NPLs out of a total of €10.76 billion in loans. Among non-financial corporations, NPLs stood at €613 million, representing 4.7% of total loans; however, the rate among SMEs was significantly higher, at 7.1%.

The volume of restructured loans also declined, reaching €1.21 billion in July, compared to €1.23 billion in June.
Of this amount, approximately €640 million — more than half — remain classified as non-performing, indicating that while restructuring efforts continue, challenges persist for a portion of borrowers.