Here are the top business stories in Cyprus from the week starting March 24:
According to the association, this can be explained by several factors related to the way interest rates are calculated and the terms of loan agreements.
The association explained that “loans may be linked to different reference rates, such as the ECB rate, the interbank EURIBOR rate, or the base interest rates of banks”.
“The adjustment of repayments depends on the type of interest rate and the frequency of adjustments set out in the loan agreement,” it added.
The initiative, which cost the group approximately €24.2 million, is expected to yield annual payroll savings of around €11.2 million.
According to the bank’s annual report for 2024, the scheme was open to permanent staff across the bank, Pancyprian Insurance, and Hellenic Life Insurance, and took the form of a voluntary separation.
The changes aim to enable the Republic of Cyprus to recover €43 million withheld by the European Commission due to legislative shortcomings.
The funds were withheld after deficiencies were identified in the implementation of legislation linked to two key milestones necessary for the disbursement of Recovery and Resilience Plan funds.
According to the announcement, the scheme “aims to attract nationals from non-European Union (EU) and non-European Economic Area (EEA) countries, allowing them to reside in Cyprus”.
This is conditional on the premise that their work “is carried out remotely, using technology, for companies or clients established abroad“.
“The purpose of the scheme is to strengthen Cyprus as a hub for electronic services,” the announcement stated.
“Combined with the country’s other advantages, attracting digital nomads will contribute to the development of the business ecosystem and, consequently, to the economic growth of the country,” it added.
The association has argued that it fails to achieve meaningful modernisation and lacks key mechanisms to ensure tax justice.
In addition, it called for an additional tax bracket of 40 per cent for annual incomes exceeding €120,000.
According to the association, the proposed reforms introduce outdated practices without providing mechanisms for resolving tax disputes, potentially undermining tax fairness.
It argued that the suggested framework does not constitute a comprehensive tax transformation plan but rather a set of fragmented improvements to certain aspects of the existing system.
“The CypERC proposals do not represent an action plan for a comprehensive tax transformation that could support Cyprus’ development strategy in the new era,” the association said in its statement.
In its report, the agency updated its macroeconomic forecasts for several sovereign nations, including Cyprus.
It increased its 2025 GDP growth estimate for Cyprus by 0.3 percentage points compared to its December 2024 projection, now expecting economic expansion to reach 3.1 per cent.
In addition, the agency maintained its forecast for 2026 GDP growth at 2.9 per cent.
In terms of unemployment, the agency now expects the jobless rate in Cyprus to stand at 4.9 per cent in 2025, revising its estimate downward by 0.2 percentage points from the previous December forecast.
He added that seasonal tourism was gradually becoming a thing of the past.
Pre-bookings from November 2024 to January 2025 showed a 7-10 per cent increase for the summer. However, from February onwards, overall pre-bookings across the island slowed significantly, though Paphos recorded a marginal increase, Loizides said.
The island’s tourism sector depends largely on visitors from the United Kingdom, Israel, Poland, Greece, Germany and France.
This was evident in Cystat’s latest report detailing the results of its 2024 survey on the use of information and communication technologies (ICT) and e-commerce in businesses.
Recruitment challenges were also referenced in the report, as 12.2 per cent of businesses attempted to hire ICT personnel, but 6.4 per cent faced difficulties due to a lack of skilled professionals.
Security remains a priority for Cypriot businesses, with 95 per cent implementing strong password protections and 90 per cent utilising data backup systems.
Moreover, artificial intelligence (AI) adoption has increased among businesses, with 7.9 per cent utilising AI technologies in 2024, compared to 4.7 per cent in 2023.
For the first time a Cypriot has been elected to the position of Vice Chair of the International Maritime Organisation, the deputy ministry of shipping announced on Wednesday.
In a press release the ministry said the election of its Legal Affairs Director Lydia Markari-Kyriacou to the post had been unanimous by IMO member states during the legal committee’s 112th session, currently taking place in London.
Markari-Kyriacou’s nomination was a recognition of her contribution to the IMO’s work and “a significant commitment towards the future in advancing pressing legal maritime issues and the shaping international maritime law”, the ministry said.
This assessment, based on the independent valuation report, concludes that “the proposed consideration to be paid by the offeror to the shareholders of the company in connection with the public offer is fair and reasonable from a financial perspective,” subject to the assumptions, reservations, and limitations detailed in the Independent Valuation Report.
“Taking into account these conclusions, the board agrees with and adopts the independent expert’s opinion that the proposed consideration ‘is fair and reasonable from a financial point of view’,” said Hellenic Bank’s board of directors.
In its announcement, the bank underlined its strong capital position and its ability to generate returns for shareholders.
According to the final results, net interest income for the year ending December 31, 2024, stood at €822 million, marking a 4 per cent annual increase.
The Common Equity Tier 1 (CET1) capital ratio and the Total Capital Adequacy Ratio, calculated for supervisory purposes, were reported at 19.2 per cent and 24.0 per cent, respectively.
The minister outlined Larnaca’s recent progress in terms growing its tourism sector, while the city’s bid to be selected as the European Capital of Culture 2030 was also discussed.
The event, focused on tourism management and prospects in Larnaca, was organised by the Larnaca-Famagusta District Committee of the Cyprus Centre for Studies, and the Larnaca regional tourism board (Etap).
In his address, Koumis underlined the importance of destination management planning and outlined the key factors that attract visitors to Larnaca.
He highlighted the district’s comparative advantages, including its strategic location, rich history and culture, and extensive coastline.
It should be noted that the group’s management is currently in Cyprus for a board of directors meeting.
In this context, the management of Hellenic Bank, a member of the Eurobank Group, hosted a dinner with a number of prominent guests on Wednesday evening.
These included president Nikos Christodoulides, finance minister Makis Keravnos, and deputy minister to the president Irene Piki.
During the event, Christodoulides addressed the members of the Eurobank board, saying that “their presence reflects the strong footprint of the bank in the country, while also serving as evidence of Cyprus’ role as a dynamic and reliable financial and business hub in the region”.
As a result, Demetra’s board of directors expressed its agreement and has subsequently adopted this opinion.
According to reports that emerged on Thursday, the board took into account several factors when considering the offer.
These include the content of the public offer document, the interests of the company’s shareholders, its overall interests, the objectives and intentions of Logicom, the financial data of Demetra, the potential impact of the offer on employees, and the independent expert’s report.
In a statement released on Friday, at the conclusion of an IMF mission to Cyprus from March 17 to 28, mission chief Alex Pienkowski highlighted key economic developments and policy priorities for the country.
“Cyprus has demonstrated impressive resilience to successive shocks,” he said. “Growth has remained among the highest in the euro area, mainly supported by foreign investment, strong tourism, and a boom in the ICT sector“.
“Inflation is declining but remains above 2 per cent and signs of moderate overheating have emerged,” he added.
Pienkowski also said that “fiscal performance continues to be strong, with debt on a firm downward trajectory”.
In a statement released on Friday, the ministry expressed agreement with the IMF’s assessment that the Cypriot economy has demonstrated resilience in the face of successive shocks and that fiscal indicators remain strong and on the right track.
Regarding the recommendations, the ministry acknowledged the importance of focusing fiscal policy on reducing public debt while avoiding any fiscal relaxation.
This aligns with the reference trajectory set for the increase in net primary expenditures under the new European economic governance framework.
The ministry also stated that “the real estate sector is being closely monitored due to its significant impact on various aspects of the economy and macroeconomic stability“.
The non-performing loan (NPL) ratio in Cyprus stood at 1.9 per cent at the end of 2024, marking a decrease of 0.3 percentage points compared to the previous quarter and a decline of 0.5 percentage points over the past twelve months.
This improvement is the largest among the EU countries assessed by Scope Ratings.
The progress reflects ongoing efforts to stabilise the banking sector, as the NPL ratio in Cyprus had exceeded 19 per cent in 2019.
The reduction is largely attributed to the targeted strategies of the country’s two largest banks.
The Bank of Cyprus managed to lower its non-performing loan ratio from 3.6 per cent in 2023 to 1.9 per cent in 2024, while Hellenic Bank reduced its ratio from 2.5 per cent to 2.4 per cent.
Hellenic Bank officially announced that the process will commence with the transfer of Eurobank Cyprus’ banking operations to Hellenic Bank, followed by the full merger of the two organisations.
This will be achieved through a restructuring and merger plan in line with the provisions of Cypriot corporate legislation.
“The board of directors of the bank, during its meeting yesterday, decided, among other things, that after the completion of the current public offer to acquire up to 100 per cent of the issued share capital of the bank and the exercise of the squeeze-out right by Eurobank S.A., as already announced, the merger of the bank with Eurobank Cyprus Ltd shall commence,” Hellenic Bank stated in its official announcement.
The report, submitted to parliament this week and published by the Treasury outlined key fiscal developments over the year.
The Treasury clarified that the reported total debt excludes intergovernmental borrowing, which amounted to €12.03 billion in 2024, compared to €10.73 billion in 2023.
According to an announcement by the Treasury, the fiscal report was originally submitted to Finance Minister Makis Keravnos by accountant general Andreas Antoniades on March 7, 2025.
The minister then presented it to the Council of Ministers, which approved it on March 26, 2025.
Specifically, the bank was recognised in the categories of Cyprus’ Best International Private Bank, Cyprus’ Best for UHNW (Ultra-High Net Worth), Cyprus’ Best for Discretionary Portfolio Management, and Cyprus’ Best for Alternative Investments.
“These awards underscore Eurobank Cyprus’ dedication to providing high-level, internationally acclaimed banking services, with an emphasis on exceptional customer service,” the bank said.
“They also reflect the bank’s ongoing growth, the trust of its clientele, and the professionalism of its experienced Wealth Management team,” it added.
According to the announcement, a key factor in this success is the bank’s “pioneering private banking service model adopted by Eurobank Cyprus and the Eurobank Group”.
