Bank of Cyprus is on track to return to steady profits after it announced a third-quarter after-tax profit of €19 mln and a significant reduction in its non-performing loans.
The bank reported a turnaround from a €7 mln loss in the second quarter, with accumulated 9-month positive earnings of €20 mln.
The 2021 accounts are impacted by the sale of the final two large tranches from its troubled loan book, ridding €1.3 bln in June to PIMCO, dubbed Helix-2, and a further €708 mln, including real estate worth €120 mln, concluded in November, also to PIMCO.
Commenting on the reduction of non-performing exposures to single-digit ratios as part of the bank’s loan book, CEO Panicos Nicolaou said: “Overall, since the peak in 2014, we have now reduced the stock of NPEs by €14.1 bln or 94% to less than €1 bln and the NPE ratio by 54 percentage points, from 63% to less than 9% on a pro forma basis.”
“We remain on track to achieve an NPE ratio of c.5% in the medium term.”
Nicolaou said the bank’s net fees and commissions remain strong, up 20% year to date and now amounting to 30% of total income.
“We continue working on our business model to improve our profitability, and our operating expenses were flat in the quarter.
“Our cost to income ratio (excluding levies and contributions) for the year to date stood at 61%. We stand by our commitment to reducing our cost to income ratio to our target of mid-50% in the medium term.”