[INSIGHT] CyprusProfile.com asked Libor Krkoska, Head of Office European Bank for Reconstruction and Development (EBRD) in Cyprus, which key areas of opportunity or growth he sees in the banking sector, and what his expectations are for Cyprus in 2017.
"Cyprus has returned to robust growth in 2016 based on an excellent performance of its tourism, property, professional services, and shipping sectors. Strong growth and declining unemployment have led to a sustained increase in bank deposits although work-out of excessive non-performing loans will continue to be the main preoccupation of local banks for several more years before they could start increasing lending to the real economy again. Restructuring of impaired loan portfolios is expected to benefit from outsourcing loan servicing to specialist companies, speeding up improvements in the quality of banking sector assets. The economy is likely to get a boost by improved operations of the Limassol port following its transfer to private concessioners. Investments in renewable energy generation and resource efficiency offer many new opportunities for investors outside the traditional sectors. Last, but not least, potential reunification of the island will provide additional impetus to growth and development, offering new prospects for all stakeholders and assisting further economic diversification".