Cyprus’ banking sector is undergoing significant changes, with recent mergers reshaping the financial landscape. At the same time, Cypriots are paying the highest mortgage rates in the eurozone while receiving some of the lowest interest rates on their deposits. “The banking system operates close to an oligopoly, limiting competitive pressure,” said Central Bank of Cyprus […]
Cyprus' banking sector faces concerns due to high lending rates, the highest mortgage rates in the Eurozone, and low deposit interest rates. Limited competition among banks, coupled with high liquidity, allows banks to maintain low deposit rates while profiting from ECB deposits. The Central Bank of Cyprus lacks the authority to directly regulate interest rates, which are determined by the ECB. Lawmakers are addressing abusive contract clauses, and concerns are growing over potential increases in non-performing loans due to rising borrowing costs.
