Nicosia:The interest rate on household deposits with an agreed maturity of up to one year increased to 1.62% in September, compared to the previous month, while consumer credit interest rates saw a decline to 6.45%. This data comes from the Statistics on Interest Rates applied by Monetary Financial Institutions (MFIs), as released by the Central Bank of Cyprus.

According to Cyprus News Agency, the report highlights several key changes in interest rates for new deposit and loan contracts, including renegotiated contracts for September 2026. The interest rate on household deposits rose from 1.35% the previous month, while non-financial corporations experienced an increase to 1.70% from 1.56%.

In terms of lending rates, the interest rate on consumer credit fell from 7.12% to 6.45%. Loans for house purchases also decreased to 3.88%, down from 4.16%. Meanwhile, loans for non-financial corporations under £1 million saw an increase from 4.45% to 4.76%, and those over £1 million rose from 3.67% to 4.40%.

The statistics further revealed that pure new loans rose to £596.2 million in September, a significant increase from £251.4 million the previous month. Specifically, new loans for consumption increased to £32.2 million, and those for house purchases rose to £135.1 million. Pure new loans to non-financial corporations under £1 million increased to £45.4 million, while those over £1 million surged to £376.7 million.

Interest rates on outstanding loans in Cyprus are close to the Eurozone median, with household rates slightly lower and non-financial corporation rates slightly higher. However, interest rates on outstanding deposits in Cyprus are among the lowest in the Eurozone, attributed to higher excess liquidity in Cypriot credit institutions. The Liquidity Coverage Ratio in Cyprus stood at 305% in September 2026, compared to the EU median of 182%.

The report also notes a declining trend in the share of new loans to households for house purchases with variable interest rates, dropping to 9.8% in September 2026 from nearly 100% in early 2022. Similar trends are observed for new loans with floating interest rates for both households and non-financial corporations. These shifts are significant for banks' risk management policies as they reflect changes in borrower behavior regarding interest rate risk.