Nicosia: Fitch Ratings has upgraded the Bank of Cyprus’ Long-Term Issuer Default Rating (IDR) to ‘BBB’ from ‘BBB-‘ and Viability Rating (VR) to ‘bbb’ from ‘bbb-‘. The Outlook on the Long-Term IDR is Stable.
According to Cyprus News Agency, the credit agency stated that the upgrade reflects the improvement of the Cypriot operating environment score to ‘bbb’. This reflects an assessment of improved business and financial prospects for Cypriot banks due to continued economic growth, falling unemployment, and reduced private sector indebtedness.
The upgrade also considers ongoing improvements in the Bank of Cyprus’s standalone credit profile, which has been bolstered by a further reduction in legacy problem assets, sound profitability prospects, and satisfactory capital buffers.
Fitch Ratings emphasized that the Bank’s ratings reflect its strong competitive position as one of the leading domestic banks in the small Cypriot market. The ratings are also supported by stable deposit funding, sound profitability, satisfactory capitalisation, and improved asset quality.