The solvency ratio of the Cypriot banking sector rose to 25.7 per cent in the first quarter of 2024, according to a report released this week by the Central Bank of Cyprus (CBC).
The report, which compiled key consolidated financial indicators for the sector, noted that the solvency ratio stood at 21.7 per cent during the same period in 2023, and 25.5 per cent seen during the fourth quarter of last year.
The figures indicate a significant improvement in efficiency, as the cost-to-income ratio decreased to 30.5 per cent in March 2024, down from 33.5 per cent in March 2023 and 32.8 per cent in December 2023.
Additionally, the Common Equity Tier 1 (CET1) ratio, a key measure of a bank’s financial strength, saw an increase to 23.4 per cent in Q1 2024, up from 19.3 per cent in the same period of the previous year.
In terms of income sources, net interest income accounted for 78.6 per cent of total income at the end of March 2024, a rise from 68.5 per cent in March 2023 and 76.2 per cent in the previous quarter.
Meanwhile, net fee and commission income made up 13.1 per cent of total income in the first quarter, which is a decrease from 14.3 per cent in the previous quarter and 15.3 per cent in March 2023.
Total loans represented 40.8 per cent of total assets at the end of March 2024, up from 39.1 per cent in December 2023 and 40.5 per cent in Q1 2023.
On the other hand, cash and cash equivalents accounted for 34.8 per cent of total assets in March 2024, a decline from 38 per cent in March 2023 and 37.9 per cent in December 2023.
Finally, regarding expenses, staff costs increased to 55.4 per cent of total costs in the first quarter of 2024, compared to 52.9 per cent in the previous quarter.
