Total non-performing loans dropped last month by €37.9m to below €24.7bn, after falling by €687.4m the month before, the central bank said in a statement on its website on Tuesday. The drop wasmainly on €50m decline in loans of large non-financial corporations which offset a €26m increase in bad loans of small and medium size enterprises.

The value of restructured loans dropped in July by €29.9m to €13.7bn while that of loans with 90 days past due dropped by €78.6m to €18.4bn. Following the completion of the first post-programme surveillance mission, the European Commission and the European Central Bank urged Cyprus to pursue loan restructurings more forcefully and step up the implementation of the foreclosure and insolvency legislation to reduce non-performing loans which continue to remain very high.

As total outstanding loans fell by €310.3m in a month to €49.6bn, the non-performing loan ratio in the system rose to 49.7% in July from 49.4% in June. Since December 2014, when the central bank introduced the current methodology to classify non-performing loans, their value dropped by more than €3.6bn, compared to a €7.6bn drop in total loans.

Total accumulated provisions in the banking system dropped by €77.4m in July to €9.3bn, reflecting an increased recovery of loans to corporations.

Source: Cyprus Mail