The Central Bank of Cyprus (CBC) on Wednesday published updated data on non-performing loans and banking sector profitability, balance sheet and capital adequacy for the period ending June 30, 2025.

According to the CBC, the non-performing loans ratio of the Cypriot banking sector fell to 5.6 per cent at the end of June 2025 from 6.1 per cent in March 2025.

The decline was mainly due to currency fluctuations, repayments, positive migrations into the performing categories and write-offs.

In addition, the coverage ratio of non-performing loans with provisions rose to 62 per cent at the end of June 2025 compared with 60.5 per cent at the end of March 2025.

At the same time, total restructured loans stood at €1.2 billion at the end of June 2025. Of these, €0.6bn continued to be classified as non-performing loans.

Meanwhile, the CBC also reported that the profitability of the Cypriot banking sector decreased in the first half of 2025.

Specifically, profitability fell by €25 million, dropping from €603 million in June 2024 to €578 million in June 2025.

The reduction was primarily attributed to a drop in net interest income, the CBC reported.

Moreover, the total assets of the banking sector rose in the second quarter of 2025 by €950m, representing an increase of 1.4 per cent.

This resulted in total assets rising from €66.02bn in March 2025 to €66.97bn in June 2025.

The growth was mainly driven by an increase in loans and advances.

The Common Equity Tier 1 ratio improved by 0.4 percentage points, rising from 25.9 per cent in March 2025 to 26.3 per cent in June 2025.

This increase was mainly due to an expansion of Common Equity Tier 1 capital that outweighed the rise in total risk exposure.