NPL ratio rises to 49% in February, central bank says (Update-1)

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By Stelios Orphanides

Non-performing loan ratio in the Cypriot banking system rose to 48.9 per cent in February from 45.8 per cent in December, the Cyprus Central Bank said.

In February, total non-performing loans dropped by €16.8m, to below €26.8bn, compared to the previous month, and rose by €80.7m compared to December the Central Bank said in a statement on its website on Friday. The increase in the ratio in the first two months of the year, compared to December, was due to a gradual drop in overall loans by almost €3.5bn to €54.7bn as a result of “loan repayments by foreign-owned entities operating abroad”.

Total 90 days past due loans fell to below €20.8bn, from €21bn respectively, the bank supervisor said, adding that this was a “positive development”. Total restructured facilities rose by €88m to over €14.2bn in February compared to December. In addition, more than €10.9bn in restructured loans were classified as non-performing in February, compared to €10.7bn in December.

“In January and February 2016, there were loan restructurings worth almost €1bn,” the Central Bank said, adding that 76 per cent of loans restructured after January 1, 2014 to February 29, this year, “meet the new repayment schedule agreed as part of the restructuring agreement”.

The net balance of restructurings, as formulated at the end of each month, is also affected by both loan repayments and the reclassification of facilities after a 12-month probation period for restructured loans expires, it said.

In the first two months of the year, a total of €205m in restructured loans were removed from the non-performing loan classification and were categorized as performing after the probation period was completed.

Out of 16,496 applications for loan restructurings which were pending in December, plus those added in the first two months of the year, there were agreements for 4,528, or 27,5 per cent, while the final decision for 10,763 cases, or 65.4 per cent, was shifted to the next month, the central bank added. A total of 1,185 applications for loan restructurings or 7.2 per cent, were rejected.

“These figures demonstrated the great effort being made,” the supervisory authority said.

Total provisions for loan impairments fell in February to €9.9bn from €10bn in December.
At the end of 2014, non-performing loans, restructured loans, and loans with more than 90 days in arrears, stood at €27.3bn, €12.9bn and €22bn respectively. Total provisions for loan impairments at the end of 2014 stood at almost €9bn.

The total amount of household non-performing loans rose in February by €132m, to €12.8m, in February compared to December, while it fell in the case of non-financial corporations and financial corporations by €32.4m, to €10bn, and by €15.m, to €665m, respectively, the central bank said.

 

 

Feb 29, 2016

Jan 31, 2016 Dec 31, 2015 Sep 30, 2015 Dec 31, 2014
  Million € Million € Million € Million €

Million €

 Total loans

54.721

54.918 58.204 57.179

57.224

 NPLs

26.766

26.783 26.685 27.328

27.328

90 DPD

20.758

20.991 21.007 22.100

22.015

Restructured facilities

14.242

14.137 14.154 13.956

12.860

Restructured facilities classified as NPLs

10.915

10.799 10.713 10.402

9.234

Total provisions

9.927

9.975 10.015 9.352

8.974

1 425 426 427 428 429 467

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