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Cyprus closed out 2024 with a surge in banking activity, as both loans and deposits saw substantial increases, according to the latest data from the Central Bank of Cyprus (CBC). December saw a net loan increase of €503.2 million, while total deposits climbed by an impressive €977.4 million—a significant jump compared to previous months.
Lending Rebounds with Strong Growth
The loan market bounced back after a sluggish November, when lending had dipped by €1.8 million. With December’s upswing, the annual growth rate of total loans accelerated to 2.8%, up from 1.9% in November, bringing outstanding loans to €25.4 billion.
A closer look at the numbers shows that loans to Cyprus residents increased by €150.7 million. Households borrowed €111.3 million, while businesses—classified as non-financial corporations—secured €111.4 million in new loans. Other domestic sectors, however, saw a reduction in borrowing, with a net decrease of €72 million.
Deposits Surge, Driven by Seasonal Factors
On the deposit side, December’s nearly €1 billion increase far outpaced the modest €91.6 million rise seen in November. The CBC attributed part of this boost to seasonal trends, which typically see higher deposit inflows at year-end.
The annual deposit growth rate reached 6.6%, compared to 5.4% in November, pushing total deposits to €55.9 billion. The bulk of this increase came from Cyprus residents, whose deposits rose by €877.2 million. Household savings played a major role, with deposits surging by €594.5 million, while non-financial corporations saw a €135.3 million decline. Other domestic sectors added €418 million in deposits.
A Positive Outlook for 2025?
The strong year-end performance suggests growing confidence in Cyprus’ financial sector, with increased lending pointing to higher investment and economic activity. The rise in deposits also indicates liquidity in the banking system, potentially supporting further lending in the months ahead.
With 2025 underway, the key question remains: Will this momentum continue, or was December’s boost just a seasonal spike?
