Bank of Cyprus has released its financial report for Q1 2023, showcasing robust performance and positive indicators across various key metrics. The bank recorded a profit of EUR 95 million, a significant increase compared to EUR 75 million in Q2 2022 and EUR 17 million in Q1 2022. Return on Tangible Equity (ROTE) also exhibited a notable improvement, reaching 21.3% for Q1 2023, compared to 17.3% in Q2 2022 and 4.0% in Q1 2022.
The Common Equity Tier 1 (CET1) ratio, accounting for transitional provisions, remained stable at 15.2% as of March 31, 2023, compared to the adjusted figure of 15.2% as of December 31, 2022. The bank experienced organic capital generation during Q1 2023, amounting to 90 basis points. Factors impacting the CET1 ratio included income before provisions, the final implementation of transitional provisions of IFRS 9, provisions and impairments, and the dividend of €50 million received from a subsidiary conducting life insurance business in February 2023. The Total Capital Adequacy Ratio stood at 20.3% as of March 31, 2023.
Bank of Cyprus demonstrated growth in lending activities, with total borrowings amounting to €10,278 million at the end of Q1 2023, a 1% increase from the previous quarter. New lending to Cyprus witnessed a seasonal upswing, reaching €624 million, a 41% rise quarter-on-quarter and relatively stable year-on-year. The lending primarily encompassed loans to large corporates (€297 million), retail banking (€186 million, including €108 million for housing loans), SMEs (€77 million), and the shipping and international operations sector (€64 million). The bank maintained strict lending criteria throughout this growth phase.
Non-performing loans (NPLs) decreased by €22 million, or 5%, during Q1 2023, resulting in NPLs accounting for 3.8% of total loans at the end of the quarter, down from 4.0% at the end of Q4 2022. The coverage rate of NPLs increased to 73% at the end of Q1 2023. Customer deposits remained steady, totaling €18,974 million, while the Bank's market share of deposits in Cyprus stood at 37.3%. The cost-to-revenue ratio for Q1 2023 was 34%, reflecting improved efficiency compared to previous quarters.
Overall, Bank of Cyprus showcased a strong financial performance in Q1 2023, with increased profitability, prudent lending growth, improved asset quality, and efficient cost management. The bank's strategic initiatives contributed to positive outcomes, positioning it favorably in the market.
[Information from Kathimerini.com.cy]
