Private sector indebtedness drops to 265% of GDP, central bank says


By Stelios Orphanides

Cypriot households and non-financial corporations saw their cumulative debt fall in the first quarter of the year, to 265.4 per cent of economic output, from 268.3 per cent at the end of 2016, the Central Bank of Cyprus said.

Household debt dropped at the end of March, to 121.2 per cent of the economy, from 126.8 per cent three months before, the central bank said in its indebtedness report, issued twice a year. The indebtedness of non-financial corporations dropped to 144.2 per cent, from 147.9 per cent. Bank credit extended to the non-financial sector fell in March to 221.1 per cent, from 225.8 per cent at the end of December.

The net value of financial assets of households fell in the first quarter of the year to 110 per cent of gross domestic product (GDP), from 113.7 per cent three months before, the bank supervisor said. On the other hand, those of non-financial corporations rose to 204.7 per cent, from 202.1 per cent respectively.

The central bank said non-performing loans were declining, after peaking in February 2015. Yet, the pace of reduction has to accelerate to allow banks finance economic growth.



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Stelios Orphanides is a journalist at To contact Stelios Orphanides: [email protected]

  • alexander reutersward

    At least it drops

  • Kevin Ingham

    But more substance would be useful (to say the least), but any time you have a situation where debt is that much higher than GDP (ie almost 3 fold) a 1% increase in GDP results in a 3% drop in the ratio, despite people owing exactly the same as they did previously !

  • kimberworth

    I would love to know what the debt of debtors are if debt free persons like me are taken off.

  • Kevin Ingham

    Ah, they padded out the article- excellent.

    If the total debt as a percentage of GDP has fallen to 265.4% of GDP from 268.3%- that is a fall 2.9%. However we are told GDP has increased by circa 3% in the last year.

    Had debt remained the same then the ratio would have dropped by 7.95%, which actually means the nominal debt must have increased over the same period (by about 1.3% off the top of my head)