Some banks in Cyprus raise deposit rates amid overall decline

In June, most Cypriot banks reduced interest rates on deposits, but some moved in the opposite direction. According to an analysis by the Central Bank of Cyprus, only two banks increased their deposit rates — Ancoria Bank and Eurobank Cyprus.

Specifically, Ancoria Bank raised its rate from 1.06% in May to 1.14% in June, while Eurobank Cyprus increased its rate from 1.49% to 1.50%. Other major banks, on the contrary, reduced yields on time deposits of up to one year for eurozone residents. At Bank of Cyprus, the average rate dropped from 0.72% to 0.66%; at Hellenic Bank — from 0.99% to 0.97%; and at Alpha Bank — from 0.98% to 0.95%.

The International Finance Bank (MFB) cut its rate from 1.03% to 0.89%, the National Bank of Greece — from 1.37% to 1.31%, the Cyprus Development Bank — from 1.08% to 1.02%, and Societe Generale — from 0.66% to 0.62%. At the same time, Astrobank and Jordan Ahli Bank kept their rates unchanged at 0.83% and 1.38% respectively.

As for loans, the trend is mixed. The average interest rate on floating-rate mortgage loans with an initial term of up to one year (for new contracts) decreased at Bank of Cyprus from 5.14% to 5%, and especially at Astrobank — from 3.01% to 2.21%.

However, several other banks increased their rates. Hellenic Bank raised its mortgage rate from 2.19% to 3.63%, Ancoria Bank — from 2.93% to 3.32%, Eurobank Cyprus — from 3.50% to 3.72%, and HFSF — from 3.75% to 3.79%.

Thus, despite the overall trend of falling deposit rates, some banks continue to intensify competition by offering better terms to depositors, while simultaneously adjusting lending conditions.