Cypriots turn to forex loans

A record number of Cypriots turned to borrowing in foreign currency during the first nine months of the year, taking advantage of super low euro borrowing rates, according to official data released by the Central Bank.

Total loans were up by CYP 58.5 mln in September to CYP 9.56 bln, while for the first nine months of the year, they are up by CYP 233.5 mln. The bulk of the loans amounting to CYP 4.4 bln are made by individuals or personal.

Of the total CYP 9.56 bln loans, 85% were in local currency amounting to CYP 8.08 bln while CYP 1.5 bln were in foreign currency. However, in terms of growth, foreign currency loans are up by CYP 188 mln since the start of the year, while local currency loans are up by CYP 45 mln. In other words, some 88% of all new loans by residents were made in foreign currency, of which some 67% are believed to be in euros, 21% in Swiss francs, 8.5% in dollars and 3% in Japanese yen.

Deposits up sharply

The Central Bank figures also show that total deposits during September were up by CYP 285 mln to CYP 14.8 bln, of which CYP 267 mln were in foreign currency by residents and non-residents.

Residents held CYP 9.05 bln in deposits with the banks, for a gain of CYP 556.63 mln during the first nine months, of which CYP 8 bln were in local currency and the equivalent of CYP 1 bln in foreign currency.

Non residents on the other hand held CYP 5.74 bln in deposits with the local banks, which are up a stagerring CYP 1.1 bln during the first nine months of the year. Of these, CYP 611.2 mln are in local currency and the equivalent of CYP 5.1 bln in foreign currency.

Coops maintain ground

It is interesting to note that the Cooperative Credit Societies managed to maintain their deposit and lending levels. According to the Central Bank data, the Cooperatives had lent a total of CYP 3.4 bln in loans by the end of September while they held CYP 4.47 bln in deposits.