By Stelios Orphanides
Cypriot banks need to do more to tackle non-performing loans after already making “commendable” efforts and achieving “measurable progress” in recent years, a Single Supervisory Mechanism (SSM) official said.
Despite the efforts made and the progress they achieved, “additional and persistent efforts are still required to ensure further progress in the reduction of non-performing loans,” Danièle Nouy, chairwoman of the supervisory board of the SSM, the European Central Bank’s division tasked with banking supervision, said in a statement emailed by the Central Bank of Cyprus on Wednesday. “Banks have already taken decisive steps and they should make use of all available instruments”.
Nouy who is currently in Cyprus for the third time since taking office in 2014, said that she had productive meetings with her colleagues at the Central Bank of Cyprus and other banks. The Central Bank of Cyprus jointly supervises with the SSM, the Bank of Cyprus, Cyprus Cooperative Bank, Hellenic Bank and RCB Bank.
“Finally, I would like to take this opportunity to express my particular thanks to the supervisors at the Central Bank of Cyprus for their excellent cooperation during the last four years,” she added. “Their dedication to our goal is very much appreciated and I am grateful to them”.
Non-performing loans in the Cypriot banking system exceed €21bn and account less than half of total banking lending. They are considered the major risk for financial stability on the island.