April deposits exceed loans for the first time in six years, CBC says

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By Stelios Orphanides

Deposits in the Cypriot banking system rose in April by €2.4bn to €50.5bn, almost matching the government’s Cyprus Cooperative Bank deposit, and aided by an ongoing deleveraging they exceeded loans for the first time since May 2012, the central bank said.

Deposits in the banking system dropped in April by €100m to €48.6bn compared to the month before, the Central Bank of Cyprus said in a statement on its website on Tuesday.

The increase in deposits last month was also on €74.8m monthly increase in deposits held by non-financial corporations to €11.1bn and by €6.6m held by households to €28.5bn, the central bank said. The increase in deposits in these categories more than offset a reduction by €141m in the case of other financial intermediaries and €79.4m in that of insurance corporations and pension funds.

Last month’s reduction in total outstanding lending was mainly on a €62.4m net repayments by households reducing their total debt to €20.7bn followed by other financial intermediaries with a €45m net repayment reducing its debt to €7.8bn, the central bank said. The general government repaid €2.6m in loans to banks reducing its balance to €748.1m. Loans extended to non-financial corporations rose by €9.9m to €19.4bn while the debt of pension funds rose by €0.2m to €7.7m.

In April, the government issued €2.4bn in government bonds in favour of the state-owned Cooperative Central Bank and simultaneously deposited €2.5bn to the lender to soothe depositor concern over the bank’s capital adequacy. The lender is currently negotiating with two investor groups who filed binding offers to acquire its operations.

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About Author

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

  • atmost55

    Bravo Kypros mou!

  • It’s all the foreign investments going into the new towers.

    • Σπασοκλαμπάνιας

      So new money coming into the economy, great news!

      • Well it’s a temporary deposit, not regular people saving and trusting banks.

        • Σπασοκλαμπάνιας

          LOL, so they are bringing their money from abroad and deposit them in Cypriot banks BUT they do not trust and they will withdraw them soon your crystal ball told you?
          The moronic British OAPs never fail to deliver on stupid!

          • Err it’s not long term they are spending it pronto. The accounts empty as the towers go up. They are just used to fund construction.

          • Σπασοκλαμπάνιας

            They are used to fund production PLUS a nice fat margin.
            And guess where most of the expenses of building those towers go. To other Cyprus based entities bank accounts!!!
            And the profit margins will be used to fund more investments and thus the economic cycle functions and the economy grows. It really isn’t rocket science. Unless of course you are an AKEL or Corbyn voter….

          • Err no it goes to large contractors who move it abroad rather than pay their loans. Oh and they employ immigrants on peanut wages. Profit margins exist later when everything is sold. Again the money moves away back to it’s source.

          • Σπασοκλαμπάνιας

            Errr no!
            Those large contractors pay their loans to the last cent. Both because they can and because they want to be able to get more loans in the future. Their business is booming.
            And those buildings require a wide array of workers all of which spent most of their earnings in Cyprus.
            So more good news about the economy.
            Sorry if that upsets you.

          • Yes it does trickle down, people get paid that’s good. Smaller contractors survive too. What happens when the tower is finished ? It doesn’t remain a productive part of the economy. It’s an empty apartment and a passport for someone. They will have a gardener and a security guard after that so it ends. I’m not upset nor moronic or an OAP. I know investors well and contractors it’s my business i frequent with them daily. Regarding foreign workers they send money home to their dependent families when they can. My original observation that deposits are up compared to loans stands. I believe the banks have received large funds due to the construction boom. Once the bills are paid it’s gone. The trickle down doesn’t go back to the bank as easily.

  • JS Gost

    Who is stupid enough ???

    • Σπασοκλαμπάνιας

      Look at a mirror and you’ll see one.

      • JS Gost

        Living to your name I see.