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Cyprus is heading toward a major financial facelift, with a wave of mergers and acquisitions already in motion and expected to accelerate by the end of 2025. Sirens may have marked a different kind of Tuesday morning in Nicosia, but in the banking world, the alarm bells signal transformation.
According to Kathimerini's Panayiotis Rougalas, industry insiders say this summer has seen intensified behind-the-scenes activity, as several banks and insurance companies move closer to joining forces in a bid to shrink the crowded market and grow their competitive edge.
Cyprus’ banking sector is becoming leaner, more consolidated, and more focused on long-term profitability rather than short-term interest rate gains.
So far, at least three major banking deals have been announced, with more on the way, including a major transaction that could significantly reduce the number of active banks on the island. The Central Bank of Cyprus and even the European Central Bank are reportedly in the loop and broadly supportive.
Among the names in play: Hellenic Bank, Eurobank Cyprus, Alpha Bank Cyprus, Astrobank, and Ancoria Bank, all gearing up for what could be a radical reshaping of Cyprus' financial map.
Banking's new normal
With the European Central Bank beginning to ease the high interest rates that had propped up profits in recent years, banks are now looking to boost loan growth and expand their footprint through mergers.
And so far, 2025 is shaping up to be a profitable year. New loan demand is rising, driven by improving economic conditions. Two official banking mergers have already been announced, with a third expected to land on the Central Bank’s desk any day now—and possibly another in September.
The goal? Fewer, larger, more efficient banks with deeper roots in both retail and business lending.
The big players
Hellenic Bank – Eurobank Cyprus
This is the biggest deal on the table. The merged entity will operate under the name Eurobank Limited, managing €28 billion in assets. On the insurance side, Eurobank is expected to control 30% of Cyprus’ life insurance market and 22% of general insurance after completing its acquisition of CNP Cyprus, which has already rebranded as ERB.
Eurobank’s ambitions don’t stop there. The group aims to issue €1.7 billion in new loans in Cyprus between 2025 and 2027. Cyprus, they say, will also serve as a launchpad into eastern markets like India, Saudi Arabia, and the UAE.
Alpha Bank Cyprus – Astrobank
This merger will create the third-largest bank in Cyprus, with a 10% market share. The deal is expected to grow Alpha’s loan portfolio by 60% and deposits by 70%. Profits are also expected to double, with an estimated €100 million in recurring annual net income. Astrobank’s troubled loans? They’re mostly staying out of the deal—just €15 million in non-performing loans will remain on the books.
Ancoria Bank: Waiting in the Wings
Entrepreneurs Costas Kleanthous and Charalambos Panagiotou, known for their stake in trading firm XM, are preparing to take control of Ancoria Bank, increasing their combined holding from under 10% to a commanding 80%. Kleanthous is expected to acquire 50–60%, while Panagiotou will hold 20%. The deal hasn’t officially been submitted to the Central Bank of Cyprus or the ECB yet, but it's considered imminent. Swedish investor Sievert Larsson will retain a minority 20% stake.
Insurance sector joins the game
It’s not just banks making moves, insurance companies are being swept up in the consolidation, too. The Bank of Cyprus recently acquired National Insurance Cyprus, while Hellenic Bank completed its acquisition of CNP Cyprus, which will eventually be merged with Hellenic Life and Pancyprian Insurance. Meanwhile, Alpha Bank Cyprus is in talks to acquire Altius Insurance, aiming to bolster its non-interest income.
What it all means
If 2024 was the warm-up, 2025 is the main event. Cyprus’ banking sector is becoming leaner, more consolidated, and more focused on long-term profitability rather than short-term interest rate gains. For customers, this could mean better digital services and more lending opportunities. For the banks, it’s about staying competitive in a changing financial world.
And while the deals may be complex, the message is simple: the financial landscape in Cyprus is about to look very different...and very soon.
