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Eurobank reported a profit of €103 million in Cyprus during the first three months of 2026, even as earnings on the island fell compared to last year amid lower European interest rates and growing international uncertainty.
The bank’s Cyprus operations saw adjusted net profits drop by 14.7% year-on-year, according to financial results released Thursday, reflecting the wider impact of interest rate cuts by the European Central Bank.
For many ordinary Cypriots, the numbers may sound distant, but they are closely tied to everyday realities, from mortgage repayments and business loans to savings accounts and access to credit.
When interest rates rise, banks typically earn more from lending. But when rates start falling, as they have in Europe over the past year, bank profits often come under pressure.
Eurobank said its overall net interest income, essentially the money it earns from loans minus what it pays on deposits, rose slightly to €664 million across the group. However, profit margins narrowed because of the ECB’s rate cuts.
At the same time, the bank continued expanding lending activity, especially to businesses. Total loans across the group increased by €1.1 billion in the first quarter alone, including strong growth outside Greece, such as in Cyprus and Bulgaria.
Customer deposits in Cyprus stood at €23.8 billion by the end of March, highlighting the island’s continued importance for the group. Eurobank’s total assets in Cyprus reached €28.7 billion.
The bank also pointed to growing income from services beyond traditional lending, including insurance and asset management, sectors that have become increasingly important for banks looking to diversify revenue.
Despite the dip in Cyprus profits, the broader Eurobank group posted adjusted net profits of €351 million for the quarter, slightly higher than a year earlier.
Eurobank chief executive Fokion Karavias said the bank managed to maintain strong growth despite international instability and economic turbulence linked to tensions in the Gulf region.
“Loans to businesses recorded significant growth financing investments, while mortgage lending shows signs of gradual recovery,” Karavias said.
That could be welcome news for Cyprus, where high property prices and borrowing costs have left many households struggling to enter the housing market in recent years.
Karavias also said Greece and Cyprus are entering the current period of uncertainty from a relatively strong fiscal position, giving governments more room to support vulnerable households and businesses if needed.
The bank’s results come as many Cypriots continue watching interest rates closely after years of rising borrowing costs squeezed household budgets. While falling rates may ease pressure on mortgage holders, they can also reduce returns on savings and affect bank profitability.
Eurobank said it remains on track to meet its targets for 2026 despite ongoing geopolitical and economic risks.
