NON-PERFORMING loans (NPLs) in the Cyprus banking system remain very high, two months after the implementation of the new foreclosures and insolvency laws.
Although some of the banks have started to initiate foreclosure proceedings on properties pledged as collateral, new figures from the Cyprus Central Bank show that the banks still have a very long way to go to reduce their NPLs.
According to the Central Bank, NPLs reached €27.04 billion at the end of June, an increase of €68.2 million from the €26.97 billion reported at the end of May.
Loans to households stood at €23 billion of which 54.97% (€12.6 billion) were non-performing.
Construction loans amounted to €6.6 billion, of which 77.5% (€51 billion) were non-performing.
Loans for real estate activities stood at €4.1 billion of which 54.5% (€2.2 billion) were non-performing.
Further reading
Aggregate data for the Cyprus banking and co-operative sectors (Cyprus Central Bank 20.08.2015)
Not surprising really considering there is no penalty for non payment by way of primary residence protection. Why pay when the consequences of not paying are zilch.