Insider / ΚΥΠΕ
Non-performing loans (NPLs) decreased by approximately € 8 million in July, compared to the previous month, leading to a reduction of the NPL index to 17.4%, from 17.6% at the end of June 2021.
Specifically, according to the data announced on Tuesday by the Central Bank of Cyprus (CBC), at the end of July 2021 the NPLs amounted to € 4,979 million, compared to € 4,987 million in June 2021.
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In contrast, total loans increased to € 28,528 million at the end of July 2021, from € 28,391 million at the end of June 2021.
Of the EUR 4,979 million, € 14,780 million relate to corporate loans, of which € 9,446 million to small and medium-sized enterprises, and € 11,626 million to household loans.
In addition, the coverage ratio (total cumulative forecasts of banks against total NPLs), according to CBC data, amounted to 47.8% at the end of July 2021, compared to 46.8% at the end of June 2021.
In addition, the total loans restructured by the end of July 2021 amounted to € 4,133 million or 14.5% of the total loans (€ 4,008 million at the end of June 2021), of which € 2,383 million are still included in non-performing loans.
In determining the NPLs, credit institutions have an obligation to apply the definition adopted by the European Banking Authority, according to which when a non-performing loan is restructured it is not automatically transferred to the non-performing loans, but remains under monitoring in the non-performing loan category. an additional period of at least 12 months, even if the borrower follows the newly agreed repayment schedule without delay.
Therefore, according to the relevant definition, a part of the restructured loans remains non-performing even if the borrower adheres to the new repayment schedule.
