Cyprus observed a rise in net new loans in October, driven primarily by businesses borrowing more, especially in amounts exceeding 1 million euros.
Data released by the Central Bank of Cyprus (CBC) on Wednesday show net new loans increased to €360 million, up from €286.3 million in September. However, the overall volume of new loans, including renegotiations, dropped from €667.9 million in September to €533.8 million in October.
A significant trend seen in October was a sharp decline in interest rates for business loans. Rates for loans to businesses above €1 million decreased from 5.26% to 4.72%, while loans for amounts under €1 million saw a smaller drop from 5.59% to 5.45%. This easing in business loan rates indicates a more favorable climate for companies seeking funding.
The picture for consumer loans wasn’t as positive. New consumer loans saw a drop to €21.3 million in October from €30.2 million in September, with net new loans down from €22.4 million to €20.2 million. Housing loans also saw a slight decline, falling to €115.7 million from €121.6 million in September, reflecting a similar downward trend in borrowing by individuals.Â