Bank of Cyprus posts €401 million profit for the first nine months of 2024

Bank of Cyprus posted a robust profit after tax of €401 million for the first nine months of 2024 of which €131 million in the third quarter, marking a 15% increase year-on-year. The profit equates to €0.90 per share and has been fueled by resilient net interest income and strategic growth in new lending, positioning the Bank ahead of its 2024 financial targets.

Net interest income (NII) for the period reached €624 million, up 9% from last year, with the third-quarter figure holding steady at €204 million despite a 25-basis-point cut in interest rates. The Bank’s return on tangible equity (ROTE) stood at 22.9%, demonstrating both robust operational efficiency and profitability.

The Bank’s lending activity was also strong, with €1.7 billion in new loans issued, a 9% increase year-on-year. This boost in lending drove the gross performing loan portfolio to €10 billion, up 3% since the end of 2023, as the Cypriot economy outpaced the Eurozone average with expected GDP growth of approximately 3.7% in 2024.

Operating expenses rose by 7% to €266 million, largely due to inflation, yet the bank managed to maintain a low cost-to-income ratio of 32%. The balance sheet remains highly liquid and resilient, featuring €7.5 billion in ECB reserves.

Meanwhile, the Bank’s non-performing exposure (NPE) ratio fell to 2.4%, with a coverage level of 96%, reflecting solid asset quality.

The Bank shifted its stock listing this quarter from the London Stock Exchange to the Athens Stock Exchange (ATHEX), aiming to boost share liquidity and market visibility.

The Bank’s capital position also remained strong, with a CET1 ratio of 19.1% and a Total Capital ratio of 24.3%, after accounting for a planned 50% profit distribution. The Bank is targeting a 50% payout ratio for the full year, at the high end of its distribution policy.

In his statement, CEO Panicos Nicolaou noted their commitment to sustainable growth and value creation for shareholders.  He said that the Bank’s diversified business model and resilient net interest income provide a stable foundation for sustainable earnings, even as economies transition to lower interest rates.

Nicolaou mentioned that the Bank would soon review its financial targets and distribution policy for 2025, aiming for a high-teens ROTE on a CET1 ratio of 15%, while adapting to the evolving economic and rate environment.