Credit rating agency S&P has revised upwards its long-term issuer credit rating on the Bank of Cyprus-BoC to ‘BB-‘from ‘B+’, as a result of improvements in the bank’s asset quality and a reduction in credit risk, allowing the bank to face a harsher economic climate with more resilience.
The BoC credit rating upgrade follows last week’s announcement where the agency said that it has revised Cyprus’ sovereign credit rating from BBB-/A3 to BBB/A2 with a stable outlook.
Since the peak of non-performing loans-NPLs in 2014, BoC achieved a significant cumulative reduction of its NPLs through sales and organic efforts. At the end of June 2022, the bank’s NPL ratio stood at 5.7% (adjusted with the sale of an NPL portfolio expected to be completed by this year-end) while at the end of 2019 the NPL ratio stood at 30%!