Cyprus remains among the Eurozone’s five most expensive countries for both housing and consumer loans, according to December data from the Central Bank of Cyprus.
Housing loan interest rates rose to 4.75% in December 2024, up from 4.50% in November, significantly above the Eurozone average of 4.15%. Only Slovenia (4.97%), Netherlands (4.85%), and Germany (4.78%) recorded higher rates.
Consumer loan rates increased to 7.20% from 6.99%, while business loans up to €1 million rose to 5.11% from 5.01%. Larger business loans saw a decrease to 4.82% from 4.97%.
Despite political pressure on banks to reduce borrowing costs, including a December 2024 gentleman’s agreement between the government and two systemic banks, rates continue to rise.
Deposit rates remain among the Eurozone’s lowest, with household term deposits up to one year yielding 1.78% in December, compared to the Eurozone average of 2.45%. Estonia leads with 3.12%, followed by Italy at 2.97%.
Total new loans increased to €736.2 million in December from €635.7 million in November. Housing loans decreased to €120.7 million, while consumer loans fell to €17.9 million. Corporate loans over €1 million saw significant growth, reaching €499.8 million.
The Central Bank noted that mortgage portfolio composition varies monthly, affecting average rates regardless of individual bank rate changes.
Read more:
