According to the latest data from the Central Bank of Cyprus, at the end of June 2026 there were 62,771 borrowers in the credit acquisition company sector (CACs). The total contractual outstanding balance of loans amounted to €19.276 billion. Of this amount, 94.6% related to non-performing loans.
At the same time, over the three-month period the number of borrowers decreased from 64,381 in March 2026 to 62,771 in June. This means that the figure fell by 1,610 individuals and companies over the quarter. Households make up the largest group of borrowers — 53,494. Their loan portfolio has a contractual outstanding balance of €9.345 billion. Of this, €8.726 billion, or 93.4%, relates to non-performing loans.
Loans secured by residential property represent a particularly important part of the portfolio. They account for €4.813 billion. This means that a significant amount of problematic debt is linked to property used as collateral.
Almost the entire corporate portfolio is also classified as problematic
The second major category consists of non-financial companies. There are 9,214 such borrowers in the sector, while the contractual outstanding balance of their loans stands at €9.205 billion. The share of non-performing loans in this category reaches 95.5%, or €8.793 billion. This shows that the problem affects not only private borrowers but businesses as well. Another 63 borrowers fall into the category of other financial companies. They account for €726 million of the loan portfolio.
At the same time, it is important not to confuse these figures with statistics for the regular banking sector. According to the Central Bank of Cyprus, at the end of June 2026 the share of non-performing loans directly within the banking system stood at 1.6% and remained unchanged compared with the end of March 2026. This is because a significant share of older problematic loans was removed from bank balance sheets and transferred to specialised companies.
What is happening with debtors’ properties
The number of properties owned by credit acquisition companies also decreased. In March 2026, there were 8,014 such properties, while by June the number had fallen to 7,714. At the same time, their market value declined from €968 million to €918 million. The Central Bank also reports a reduction in the net carrying value of loan portfolios. At the end of June 2026, it stood at €2.671 billion, compared with €2.843 billion at the end of March 2026 and €2.802 billion at the end of 2025.
Net carrying value is the value of loans recorded in the companies’ financial statements after taking into account expected cash flows, impairment and revised assessments in accordance with international financial reporting standards.
Therefore, the contractual debt of €19.276 billion and the net carrying value of €2.671 billion are different indicators and should not be treated as the same amount of debt. The first reflects the contractual outstanding balance of the loans, while the second reflects their value in the companies’ accounting records after the relevant adjustments.
Problematic loans remain a separate challenge for the Cyprus economy
The decline in the number of borrowers and in the amount of property owned by the companies indicates that some problematic assets continue to be resolved through debt repayment, restructuring, write-offs, property transactions and other mechanisms. However, the size of the problematic portfolio remains significant: €19.276 billion in contractual outstanding balances, of which 94.6% are classified as non-performing loans. At the same time, bank lending in Cyprus continues to grow. According to the Central Bank, the total volume of loans in the banking sector reached €28.6 billion at the end of June 2026, while the annual growth rate stood at 11.6%. In June, net loan growth amounted to €499.4 million.
In addition, the results of the bank lending survey for the second quarter of 2026 show that household demand for mortgages, consumer loans and other credit increased, while standards and general conditions for granting new loans did not change significantly.
The current situation in Cyprus is therefore characterised by both growth in new bank lending and the continued presence of a large volume of historical problematic debt, which is now largely held outside the traditional banking system.