Nicosia: The Central Bank of Cyprus has unveiled its strategic vision at the 12th Banking Forum and Fintech Expo, focusing on fostering a resilient and innovative financial sector in Cyprus amidst a rapidly evolving digital economy. The bank’s agenda emphasizes digital transformation, robust governance, and addressing societal and environmental challenges to bolster financial stability.
According to Cyprus News Agency, the Central Bank of Cyprus aims to strengthen the country’s position within the European financial landscape by advancing the digital economy, exploring the potential of a digital euro, and establishing regulatory frameworks for responsible governance. The Cypriot economy has shown resilience despite geopolitical challenges, achieving a growth rate above the EU average and maintaining a strong fiscal position.
The Cypriot banking sector has demonstrated robustness, with the Common Equity Tier 1 (CET1) ratio and Liquidity Coverage Ratio (LCR) significantly surpassing European averages. However, the Central Bank of Cyprus acknowledges the need for vigilance against macroeconomic uncertainties, geopolitical risks, and emerging threats like cyber risks.
In the digital economy, the Central Bank of Cyprus highlights the importance of innovative technologies such as artificial intelligence and blockchain in enhancing financial services. The bank stresses the need for common supervisory and regulatory approaches to manage cyber risks and foster responsible innovation.
Digital payments are on the rise in Cyprus, with a significant increase in cashless transactions and e-commerce activities. The Central Bank of Cyprus supports the growth of electronic money and payment institutions, implementing a comprehensive strategy to regulate and supervise these entities effectively.
The Central Bank of Cyprus is also involved in the development of the digital euro, focusing on holding limits and setting standards for future distributors. Efforts to raise awareness about the digital euro project include engagement with stakeholders and participation in international forums.
In terms of governance, the Central Bank of Cyprus is committed to enhancing transparency and ethical standards in financial institutions. The bank also emphasizes societal considerations, such as diversity and community engagement, in its regulatory framework.
Addressing climate change, the Central Bank of Cyprus is actively involved in initiatives to assess and manage climate-related risks. The bank has established a Sustainability Team to support these efforts and contribute to the target of net-zero carbon emissions.
The strategic vision of the Central Bank of Cyprus aims to position the country as a forward-looking financial hub in Europe by embracing digital advancements, ensuring strong governance, and addressing climate change challenges, ultimately ensuring stability and prosperity for Cyprus.