NPEs decline by €0.5 billion in May

Non-performing loans (NPEs according to EBA directive) declined by €0.5 billion in May to €8.4 billion from €8.9 billion in the previous month, corresponding to 26.7% of total loans, according to data released by the Central Bank of Cyprus (CBC) on Monday.

The significant reduction is attributed to a write down of NPLs amounting to €0.5 billion in the second quarter of 2020, utilising its accumulated provisions. The Bank announced that these loans were in arrears for over four years.

NPEs in May amounted to 23% of total loans in May from 28% in the previous month.

According to the CBC, loans in arrears over 90 days declined to €7.15 billion from €7.62 in April, while total loans amounted to €32.6 billion in May from €32.03 billion in the previous month.

Out of the total NPEs, €5.14 billion have been restructured of which €3.9 billion remain classified as non-performing according to EBA definitions, compared with €5.24 billion and €3.96 billion respectively in April, the CBC added.

Total accumulated provisions in May declined to €4.4 billion from €5.11 billion April, reflecting the write down carried out by Hellenic Bank.

According to the CBC, corporate NPEs amounted to €3.7 billion in May marking a reduction of €256 million from the previous month. The majority of corporate NPEs were held by small and medium enterprises that amounted to €3.18 billion in May compared to €3.46 billion in April, according to the CBC data.

Households NPEs declined to €4.36 billion in May from €4.62 billion in the previous month.

According to the CBC, accumulated provisions for corporate loans amounted to 58.7% in May whereas the corresponding provisions for household loans amounted to 45%.