The non-performing loan ratio in Cyprus has remained stable at 1.6% as of January 31, 2026, according to the Central Bank of Cyprus (CBC). This figure marks no change from December 2025, reflecting a consistent trend in the banking sector.
The CBC’s announcement was based on the methodology set out in the European Banking Authority’s risk dashboard. This methodology encompasses loans and advances to both central banks and credit institutions, providing a comprehensive overview of the lending landscape.
While the ratio of non-performing loans held steady, the coverage ratio saw a slight decline, dipping to 62.2% at the end of January 2026 from 62.3% in December 2025. This reduction indicates a small decrease in the banks’ ability to cover non-performing loans, a metric that analysts monitor closely.
In terms of restructured loans, the total balance stood at €0.8 billion by the end of January 2026. Of this total, €0.3 billion continues to be classified as non-performing exposures, highlighting the ongoing challenges within the financial sector.
The CBC’s findings are crucial for stakeholders in the Cypriot banking industry, as they provide insight into the health of the financial system. Maintaining a low non-performing loan ratio is essential for fostering trust among investors and consumers, ensuring liquidity, and promoting economic stability.
