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New lending in 2022 in Cyprus reached €3.23 billion

02/02/2023 16:02

New credit provided by Cypriot banks reached €3.23 billion in 2022, marking an increase of 10% year one year despite the uncertainty driven by the war in Ukraine, according to data published on Thursday by the Central Bank of Cyprus (CBC).

Pure new loans in 2022 exceeded the levels of 2019 (€3.2 billion), climbing (albeit slightly) to the highest level since 2015, when the CBC began recording data for pure new credit. The rise of 2022 over 2021 was driven by corporate loans over €1 million which amounted to 28% year on year.

According to the data, loans to non-financial corporations over €1 million in 2022 amounted to €1.28 billion compared with €1 billion in 2021 and amounted to 40% of total new lending.

In its last economic bulletin, the CBC said that increased demand for corporate loans possibly could be associated with increased financing needs for working capital, due to the rising cost in energy and raw materials, as well supply chain disruptions which increase operating costs.

Loans for house purchase held the second highest share of total new lending in 2022 with 36.4%. Housing loans amounted to €1.18 billion marking a marginal increase of 0.30% compared with 2021. However, housing loans in 2021 were boosted due to a government interest rate subsidy scheme which expired in December 2021.

Corporate loans up to €1 million declined by 1.6% compared with 2021, amounting to €530.6 million compared with €539 million. The share of these loans to total new lending was 16.4%.

Pure new consumer credit reached €155.4 million up by 4.15% compared with 2021 and amounted to 4.8% of total new loans granted in 2022.

Other new loans declined by 3.31% year on year in 2022 amounting to €83 million.