Moody’s: Increased deposits in Cyprus banks is credit positive

Moodys rating agency marked Monday as credit positive, the inflow of deposits amounting to Euros 873 million at the Cypriot banking system in August 2016, raising deposits at the highest point of the last three years since April 2012.

As the agency points out in its weekly bulletin “Credit Outlook”, although Cypriot banks have a high stock of problem loans that will challenge them for a prolonged period, the increase in deposits, which was driven by less confidence-sensitive domestic residents’ deposits, will improve banks’ funding structure, a credit positive.

According to Moodys, it was the first time in six years there has been a net deposit inflow for five consecutive months, indicating improved funding conditions in a system where depositor confidence remains fragile following depositors’ losses in March 2013.

Source: Cyprus News Agency