Eurozone Lending Conditions Converge in Cyprus as Eurobank Posts Strong First-Half Profit

The Central Bank of Cyprus has reported that domestic financing conditions in Cyprus are now closer to those in the eurozone, thanks to a shift towards longer-term fixed-rate loans. According to an Economic Brief published by the CBC, the move towards fixed-rate lending has reduced borrowers' exposure to interest rate fluctuations and narrowed the gap between lending and deposit rates.

The report examined how the European Central Bank's recent monetary policy cycle reshaped the composition of bank lending in Cyprus. The CBC found that the shift to fixed-rate loans changed the transmission of monetary policy through the Cypriot economy.

Separately, Eurobank reported a net profit of €738 million for the first half of 2026, including €231 million from its Cyprus operations. The bank's chief executive, Fokion Karavias, said that despite geopolitical uncertainty and renewed tensions in the Middle East, the economies of the bank's core markets have remained on a solid growth trajectory.

The report also noted that Eurobank's non-Greek operations generated €361 million in adjusted net profit, accounting for 46.5% of group profitability. The bank's adjusted net profit reached €776 million, up 9.2% year-on-year.