NPLs decrease by €142 million in Q2

Non-performing loans (NPLs) decreased by €142 million or 2.8% in aggregate at the end of June 2021, compared with the end of March 2021, the Central Bank of Cyprus (CBC) said Thursday.

“Total loans decreased by €242 million or 0.8% from €28.633 million at end-March 2021 to €28.391 million at the end of June 2021. As a result, a decrease in the ratio of NPLs to total loans was recorded from 17.9% at end-March 2021 to 17.6% at the end of June 2021”, said the Central Bank.
 
The coverage ratio stood at 46.8% at the end of June 2021 compared with 47.2% at the end of March 2021, it added.
 
The CBC noted that between 31.12.2014 and  30.06.2021, there has been an overall reduction in NPLs of €22,3 billion or 81.8%.
 
“The downward trend in NPLs exhibited in the second quarter of 2021 can be attributed, by order of significance, to loan write-offs which take place either in the context of restructurings and usually concern amounts that already form part of credit institutions’ loan loss provisions or to non-contractual or "accounting" set-offs made against amounts already provided, aimed at a more representative depiction of loan portfolios and loan repayments (including debt-to-asset swaps). Moreover, positive migrations of loans which have been successfully restructured and reclassified as performing (cured) at the end of the probation period have contributed to the decrease in NPLs”, the CBC explained.
 
It said that total restructured loans at end-June 2021 amounted to €4.008 million, of which €2.342 million continue to be classified as NPLs.