According to data released by the Central Bank of Cyprus (CBK) on Tuesday, March 5, housing loans in the island nation declined by 6% in January 2024.
Specifically, in the first month of the new year, local financial institutions disbursed €72 million to mortgage borrowers compared to €76 million in January 2023.
According to the CBK, this trend is primarily due to rising interest rates on housing loans and deteriorating consumer confidence in banks.
In turn, the total amount of new loans granted by banks to households and businesses in January 2024 rose by 47% or to €220 million from €149 million in the corresponding month of the previous year.
Interestingly, the largest volume of new loans in January 2024 was for loans to non-financial corporations of more than €1 million - €83.3 million (+379%) compared to €17.4 million in January 2023.
At the same time, new loans to non-financial corporations of up to EUR 1 million increased to EUR 41 million from EUR 38 million in the corresponding month of 2023. The increase amounted to 5%. In turn, new consumer loans showed an increase of 65% year-on-year. In January 2024, Cyprus issued €20 million of loans in this category compared to €12 million a year earlier.
Finally, other categories of loans fell by a combined 17%, with net new lending falling to €4.4 million in January 2024 compared to €5.3 million in the corresponding month last year.