Nicosia, Cyprus. The profitability of Cyprus’ banking sector fell by 23.6 per cent in the first quarter of 2026, according to updated aggregate figures published on Friday by the Central Bank of Cyprus. The data, with a reference date of March 31, 2026, also showed an increase in total assets and a decline in the sector’s Common Equity Tier 1 ratio.
Profitability declines
According to the Central Bank of Cyprus, banking sector profitability declined by €62 million to €202 million in the first quarter of 2026, compared with €264 million recorded in March 2025.
The central bank said the decline was mainly driven by a reduction in net interest income and by losses arising from foreign exchange differences.
Assets increase
The total assets of the banking sector increased by €274 million, or 0.4 per cent, during the first quarter of 2026.
Total banking sector assets reached €70.23 billion, up from €69.96 billion at the end of December 2025. The Central Bank of Cyprus said the increase was primarily due to higher levels of loans and advances, as well as an increase in debt securities holdings.
Capital adequacy ratio falls
The Common Equity Tier 1 ratio of the banking sector declined by 0.7 percentage points at the end of March 2026.
The ratio stood at 25.1 per cent, compared with 25.8 per cent at the end of December 2025. The Central Bank of Cyprus said the decrease was mainly the result of an increase in the total risk exposure amount, which offset the rise recorded in Common Equity Tier 1 capital.
