The Central Bank of Cyprus (CBC) on Thursday reported that interest rates on new housing loans declined in March, while borrowing costs for businesses remained above the euro area average.

At the same time, the central bank said that deposit rates for households and businesses in Cyprus remained lower than eurozone levels, reflecting continued divergence in savings returns.

For household term deposits with a maturity of up to one year, the weighted average interest rate stood at 1.18 per cent, compared with 1.82 per cent in the euro area.

Among banks, the National Bank of Greece (NBG) Cyprus offered a rate of around 1.57 per cent, while the Bank of Cyprus provided approximately 0.87 per cent, with Eurobank Cyprus and Alpha Bank Cyprus offering 1.17 per cent and 1.39 per cent respectively.

For non-financial corporations, the average deposit rate rose to 1.39 per cent in March, still below the eurozone level of 1.94 per cent.

Differences across institutions were evident, with Ancoria Bank offering 1.51 per cent and the National Bank of Greece Cyprus offering 1.55 per cent.

In addition, Alpha Bank Cyprus’ rate stood at 1.24 per cent while the Bank of Cyprus’ rate was 1.40 per cent.

The Housing Finance Corporation recorded one of the lowest rates at 0.66 per cent, highlighting disparities in deposit pricing.

In the housing loan segment, the average interest rate for new loans declined to 3.09 per cent, compared with 3.40 per cent in the euro area, marking a gradual easing from previous months.

At bank level, Eurobank Limited offered 3.06 per cent, while the Bank of Cyprus stood at 3.20 per cent and the Housing Finance Corporation at 3.37 per cent.

Alpha Bank Cyprus, Ancoria Bank and National Bank of Greece Cyprus recorded lower rates ranging between 2.72 per cent and 2.78 per cent.

For renegotiated housing loans, the average rate increased to 3.34 per cent, exceeding the eurozone average of 3.20 per cent.

Combining new and renegotiated loans, the overall weighted average housing loan rate reached 3.15 per cent, remaining below the eurozone figure of 3.35 per cent.

In variable rate housing loans with an initial fixation period of up to one year, the average rate for new contracts stood at 3.78 per cent in March.

Alpha Bank Cyprus offered 3.47 per cent, while Ancoria Bank and the National Bank of Greece Cyprus recorded lower levels of 2.53 per cent and 2.72 per cent respectively, with Eurobank at 3.58 per cent.

The Housing Finance Corporation provided 3.37 per cent, while the Bank of Cyprus recorded the highest rate at 4.53 per cent in this category.

For renegotiated loans of the same type, Eurobank offered 3.80 per cent and the Bank of Cyprus 4.32 per cent, resulting in a Cyprus average of 4.01 per cent.

Combining new and renegotiated loans, the overall average reached 3.86 per cent, remaining above the eurozone average of 3.50 per cent.

In business lending, borrowing costs continued to exceed eurozone levels, particularly for loans up to €1 million with variable rates and short review periods.

The average interest rate for such loans stood at 4.40 per cent, compared with 3.74 per cent in the euro area.

Ancoria Bank recorded the highest rate at 6.35 per cent, followed by Societe Generale Bank Cyprus at 6.17 per cent.

The Bank of Cyprus offered 4.91 per cent, while Alpha Bank Cyprus stood at 4.03 per cent and the Cyprus Development Bank at 4.69 per cent.

The National Bank of Greece Cyprus recorded a rate of 3.94 per cent, while Eurobank Limited provided one of the lowest rates at 3.83 per cent.

For business loans above €1 million, the average rate in Cyprus stood at 4.10 per cent, compared with 3.36 per cent in the euro area.

New lending rates ranged from 3.65 per cent at the Bank of Cyprus to 4.30 per cent at the National Bank of Greece Cyprus, with Eurobank Limited at 3.88 per cent and Alpha Bank Cyprus at 4.11 per cent.

Ancoria Bank recorded 4.10 per cent for new loans in this category.

For renegotiated loans, the average rate increased to 4.58 per cent, with the Bank of Cyprus at 4.67 per cent, Alpha Bank Cyprus at 4.62 per cent and Eurobank Limited at 4.16 per cent.