The Central Bank of Cyprus (CBC) has released new data indicating that interest rates in Cyprus still notably diverge from eurozone averages, although some categories have seen the gap narrow. Average interest rates on household deposits up to one year in Cyprus stood at 1.20%, compared with 1.89% across the eurozone. Lending rates in Cyprus also continue to be generally higher than in the eurozone.

Among banking institutions, rates vary significantly, with the National Bank of Greece offering the highest deposit returns and the Bank of Cyprus the lowest for several categories. For example, new housing loan rates averaged 3.10% in Cyprus, slightly below the eurozone average of 3.45%, while existing loans to non-financial corporations exceed eurozone rates, averaging 4.07% compared to 3.09%.

Although some interest rate differences have lessened, Cypriot savers still receive comparatively lower returns on deposits, and borrowers face higher lending costs relative to the wider eurozone. The CBC’s report underlines ongoing disparities in Cyprus’ banking sector within the single currency area.