By Stelios Orphanides
Non-performing loans in the Cypriot banking system fell in August to below €21.9bn, the lowest since December 2014, or 44.7 per cent of total, from below €22.4bn the month before, the Central Bank said on Monday.
The drop in the delinquent portfolio of Cypriot banks in August was mainly on €365.3m reduction in household non-performing loans to €11.4bn in a month accompanied by a €130m drop in corporate non-performing loans, the bank supervisor said in a statement on its website. The drop in corporate non-performing loans included a €64.5m decline in bad loans extended to small and medium-size enterprises (SMEs).
In August, the total amount of loans and advances fell by €562.4m compared to July to €48.9bn, mainly on a net €408.7m household loan repayment reducing household credit to €20.8bn, the central bank said. Non-financial corporation debt fell by €115.8m to €19.1bn.
The amount of loans which were more than 90 days in arrears fell in August to €16.8bn by €387m in a month, the central bank said. Restructured loans at the end of August stood at €12.6bn, down €134.4m. The amount of cured restructured facilities fell by €51.9m to €8.8bn or 70 per cent of restructured loans.
In August, banks also reduced overall provisions for loan impairments by €435.1m to €10bn, the central bank said.
Compared to August 2016, non-performing loans fell by €2.7bn, which included €1.9bn in less delinquent loans extended to corporations and €886.6m extended to households, according to the data. Since December 2014, when the European Banking Authority’s (EBA) methodology came into force, total non-performing loans fell by €5.5bn against a €8.3bn reduction in total credit. Companies reduced their bad loans by €3.7bn while in the case of household the drop was €1.1bn.