29.07.2022
Cypriot banks see a tightening of lending criteria in the second quarter of 2022 due to the uncertainty surrounding the Russian invasion of Ukraine, according to the Bank Lending Review for Quarters 1-22 (BLR) conducted by the Central Bank of Cyprus (CBC).
“According to the expectations of banks for the second quarter of 2022, it was expected that the criteria for lending to businesses and households in Cyprus would be tightened across all categories of loans, possibly due to the uncertain geopolitical situation that began at that time with the Russian invasion of Ukraine,” the Central Bank said.
According to the Central Bank, during the first quarter of the year, the criteria for issuing loans both for businesses and for all categories of loans for the population remained unchanged compared to the previous quarter.
In terms of demand for loans, the study showed that net demand in the first quarter of 2022 did not change for loans from small and medium-sized enterprises, loans from large enterprises and mortgages.
However, the net demand for loans in Cyprus by businesses remained unchanged in the first quarter of 2022 compared to the fourth quarter of 2021, contrary to the expectations expressed in the survey for the previous quarter, where an increase was expected.
According to CBC, net demand for business loans was broadly flat in the reporting quarter, while there was an increase in the need for business financing for inventories and working capital.
“The potential increase in credit demand for inventories and working capital reflects disruptions seen in the supply chain, mainly as a result of the effects of the pandemic and the war in Ukraine, as well as a proactive business response in an environment of heightened uncertainty . “, – stated in the message of the Central Bank.
According to a report from the Statistical Office of Cyprus (Cystat) released on Thursday, the May 2022 industrial production index reached 136.2 units (2015 base = 100), up 5.3% year on year.
In the manufacturing sector, growth was 6.3% compared to May 2021.
Growth was also recorded in the mining industry and quarrying by 13.9%, as well as in the field of water supply and extraction of materials by 12.8%.
The electricity sector saw a 1.4% drop compared to May 2021.
According to the data, in the manufacturing sector, the most significant positive changes compared to May 2021 occurred in the production of textiles, clothing and leather goods, with an increase of 47 percent.
Furniture production, repair and installation of machinery and equipment grew by 26.7%, while the production of rubber and plastic products increased by 9.2%.
On the contrary, the most significant negative changes were observed in the production of electronic and optical products and electrical equipment with a fall of 23.5%.
Between January and May 2022, the index showed an increase of 4.5% compared to the corresponding period of the previous year.
During this period, the most significant growth is observed in the economic activity of textile, clothing and leather production, the increase was 56.7%.
Intake, cleaning and water supply increased by 36.4%, while furniture production, repair and installation of machinery and equipment increased by 17.1%.
Finally, the electricity supply segment increased by 12.9%.
The Cyprus Stock Exchange (CSE) ended Thursday, July 28 with a profit.
The overall Cypriot stock market index stood at 67.86 points at 13:33 during the day, reflecting an increase of 0.09% from the previous trading day.
The FTSE/CySE 20 Index stood at 40.62, up 0.07%.
The total transaction value was 340,305 euros.
As for the sub-indices, the main and alternative indices rose by 0.07% and 0.11%, respectively. Indices of hotel and investment companies remained stable.
Bank of Cyprus (no change), Cyprus Cement Company (+0.81%), Logicom (no change), Hellenic Bank (+0.23%) and Woolworth Cyprus Properties Plc (no change) attracted the highest investment interest.
