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The Bank of Cyprus has announced a 23% increase in its profit after tax for the first half of 2024, reaching €270 million, compared to the same period in 2023. The bank has also raised its financial targets for 2024 and 2025 and aims to distribute 50% of its adjusted profits as dividends for 2024, pending market conditions and approvals.
For the second quarter of 2024, profit after tax rose by 4% to €137 million. Basic earnings per share climbed to €0.61, up from €0.49 in the first half of 2023. The bank’s Return on Tangible Equity (ROTE) stood at 23.7% for the period.
The bank saw new borrowings increase by 10% year-on-year to €1.2 billion. However, its non-performing loan (NPL) portfolio grew by 3% since December 2023, reaching €10.1 billion. The NPL to loan ratio improved to 2.8% as of June 30, 2024, down from 3.6% at the end of 2023.
Group CEO Panicos Nikolaou highlighted the bank’s sustained profitability and robust business model. He noted that the bank has achieved a ROTE above 20% for six consecutive quarters, exceeding its 2024 targets. Nikolaou attributed the strong performance to resilient net interest income, disciplined cost management, and a low credit loss charge.
The bank has updated its financial targets, projecting a ROTE above 19% for 2024 and in the mid-teens for 2025. It expects net interest income to reach around €800 million for 2024, up from a previous target of €670 million, due to a more favorable interest rate environment. For 2025, net interest income is anticipated to exceed €700 million.
Total income for the first half of 2024 rose by 7% to €549 million, driven by a 17% increase in net interest income, which reached €420 million. Non-interest income, however, fell by 16% to €129 million due to lower gains from foreign exchange trading and financial instruments.
The bank’s operating profit for the first half of 2024 increased by 9% to €363 million. Total expenses for the same period rose by 4% to €186 million, mainly due to higher personnel costs.
Customer deposits grew by 2% to €19.7 billion by June 30, 2024. The bank’s market share of deposits in Cyprus remained steady at 37.5%. The loan-to-deposit ratio was 51%, consistent with earlier in the year.
The Property Management Division managed recovered properties worth €790 million, down from €973 million a year earlier. The division aims to reduce this portfolio to approximately €0.5 billion by the end of 2025.
[Information sourced from CNA]
