Bank of Cyprus reported impressive results for the first quarter of 2026, demonstrating strong growth despite ongoing global geopolitical uncertainty. Net profit after tax reached €121 million. This performance was driven by stable net interest income and strict control over operating expenses. Basic earnings per share amounted to €0.28, while the cost-to-income ratio stood at an efficient 37%. Return on tangible equity (ROTE) reached 18%, exceeding the bank’s previously announced 2026 target of a mid-teens percentage.
Loan Portfolio and Depositor Confidence: Key Growth Drivers
New lending in the first quarter of 2026 was particularly strong, reaching €829 million. This represents a 9% increase compared with the previous quarter and reflects robust business activity both in the domestic market and in international operations. The performing loan portfolio expanded to €11.1 billion, marking quarterly growth of 2%.
At the same time, the bank maintained a conservative approach to risk management. The deposit base, primarily composed of retail customers, remained stable at €22.3 billion, underscoring the high level of trust the institution continues to enjoy among individuals and businesses.
Asset Quality and Stability: Record-Low Non-Performing Loans
Particular attention was drawn to the bank’s risk management performance. The ratio of non-performing loans (NPLs) to total loans declined to just 1.1%, one of the strongest figures in the European banking sector.
In addition, the quarter saw a net credit reversal of 17 basis points. This means the bank not only avoided creating new provisions for potential losses, but also released some previously established reserves following the improved position of a major borrower. This level of asset quality makes Bank of Cyprus exceptionally resilient to external shocks.
Strong Capital Position and Generous Dividend Policy
The bank continues to reward shareholders. Its Common Equity Tier 1 (CET1) ratio remained at a very strong 20.7%, while the total capital ratio reached 25.5%. Organic capital generation amounted to 114 basis points.
Recognizing the importance of attractive shareholder returns, management reaffirmed its guidance for a 70% dividend payout ratio, which is the upper end of the bank’s current policy. Over the medium term through 2028, Bank of Cyprus aims to increase distributions to 90–100% of annual profits, making the bank’s shares increasingly attractive to investors.
As part of its diversification strategy, Bank of Cyprus announced two significant acquisitions during the first quarter of 2026. The first involves the acquisition of performing loans and deposits from the Cyprus Development Bank (CDB), totaling approximately €150 million and €500 million respectively. This transaction will strengthen the bank’s position in the corporate banking segment.
The second transaction is an investment in the European fintech company Wealthyhood. By acquiring a 26% stake, Bank of Cyprus will be able to offer retail customers digital access to a broad range of stocks and exchange-traded funds (ETFs), expanding into the online investment market.
Management Commentary and Outlook for the Cyprus Economy
Panicos Nicolaou, Chief Executive Officer of Bank of Cyprus, stated that despite ongoing geopolitical tensions, the bank remains in a very strong position. He emphasized that the Cypriot economy continues to show resilience.
Official forecasts project GDP growth in Cyprus of between 2.7% and 2.9% in 2026, significantly above the average for the euro area. Management reaffirmed its financial targets for 2026–2028, aiming to deliver mid-teens returns on tangible equity each year.
Nicolaou added that the bank’s business model continues to generate strong cash flows, supports balance sheet growth, and enables attractive shareholder returns while continuing to finance households and businesses across Cyprus.