Cyprus banks saw profits soar in 2023
The Cyprus banking sector experienced a significant surge in profitability by the end of 2023, according to the key financial indicators published by the Central Bank of Cyprus (CBC).
The return on equity (RoE) ratio for Cyprus banks jumped to 24.6% in 2023, a stark increase from 4.8% in the previous year. This dramatic rise was primarily driven by higher interest rates resulting from the European Central Bank’s restrictive monetary policy.
Total profits after tax and discontinued operations also saw a substantial increase, reaching 2% of total assets by the end of 2023, compared to just 0.3% in December 2022.
The Core Tier 1 capital ratio, which measures a bank’s core equity capital compared with its total risk-weighted assets, rose to 21.3% at the end of 2023, up from 17.8% the previous year. Additionally, the overall solvency ratio climbed to 25.5% from 21.3% during the same period.
Cash and cash balances with central banks accounted for 37.8% of total assets at the end of 2023, slightly down from 38.9% in December 2022. This decrease mainly reflects the repayment of targeted long-term refinancing operations (TLTROs).
