The rise was driven by the government’s interest rate subsidy scheme to support those affected by the Covid-19 pandemic.

According to data released Monday by the CBC, total new loans continued to rise in June, driven by net new loans and restructurings.

Total new loans increased to €674.5 million in June, from €415.3 million in the previous month.

From the €674.5 million, net new loans amounted to €291.7 million, and restructured loans amounted to €383.9 million.

Most of the net new loans were for house purchases rising to €113.7 million, followed by loans to non-financial corporations over €1 million which rose to €100.3 million.

New loans of up to €1 million amounted to €50.5 million in June, while new consumer and other loans reached €13.4 million and €12.8 million respectively.

Most restructured loans were loans to non-financial corporations for amounts over €1 million amounting to €273.4 million, followed by restructured housing loans (€58.2 million) and restructured loans to non-financial corporations for amounts up to €1 million (€50.5 million).

In June, the restructurings of consumer loans amounted to €6.4 million and the restructurings of other loans to €4.1 million.

During the six months, January – June, a total of €1.39 billion in net new loans were granted, marking an increase of 4.2% from 2020.

Private debt 

Private debt in Cyprus amounted to €56.5 billion at the end of March of 2021, with household debt reaching €19.6 billion and corporate debt at €36.9 billion.

According to the quarterly financial accounts released by the CBC for Q1 2021, non-financial corporations debt was €36.9 billion corresponding to 178% of Cyprus’ GDP, a slight increase on the previous quarter.

The CBC said that corporate debt has been steadily declining since December 2016 and has registered a reduction of 34%.

At the end of March, corporate assets were €63.7 billion, 16% in cash and deposits, 5% in loans, 1% in bonds, 49% in stocks, and 29% in other financial assets.

Household debt amounted to €19.6 billion or 95% of Cyprus’ GDP.

Household assets were €54.8 billion, 61% in cash, deposits and loans, 2% in bonds, 20% in stocks and 17% in other financial assets.

Compared with the previous quarter, the household debt to GDP index marked a significant reduction of 22%.

Source: Financial Mirror