Bank of Cyprus announces measures to support the Cypriot economy and its customers

The Bank of Cyprus has announced a set of measures to support the economy and society.

According to a recent announcement from the bank, the measures include interest rate reductions, rewards for consistent borrowers, new housing and business loans on favourable terms, as well as facilities for customers of specific age groups.

Consistent Borrowers

1. Interest rate cuts

The Bank of Cyprus is responding immediately to the decisions of the European Central Bank (ECB) to reduce the Base Rate and is proceeding with the reduction of the reference interest rate on loans linked to it. As of June 2024, the total reduction of the ECB Base Rate amounts to 1.35% (from 4.50% to 3.15%).

Regarding mortgage loans, more than 10,000 borrowers whose loans are linked to the ECB's Base Rate are seeing their installments reduced immediately.

It is recalled that for months now, the interest rates of another 8,000 borrowers whose mortgages are linked to Euribor have also begun to decrease. For example, the 6-month Euribor has gradually declined from 4.14%, which it reached in October 2023, and is currently at 2.64%.

2. Consistent borrower reward scheme

As already announced on all communication channels, the Bank of Cyprus will reward, within the framework of the plan, borrowers who hold mortgage loans with a floating interest rate based on the European Central Bank Base Rate (ECBOR) or Euribor, which were granted before September 30, 2022, based on specific criteria.

The reward is equivalent to 0.5% on the interest rate for the period 30/06/24-31/12/24.

In addition to the option for rewards through reward points, there will also be the option of granting the reward in cash by crediting the customers' bank account (customers will be given a period of 15 days to choose the method of providing the reward via the Mobile App).

3. Granting a personal loan of up to €5,000 with a favorable interest rate of 3% (fixed) for a period of 5 years to 5,000 consistent borrowers holding mortgage loans from Bank of Cyprus for the purpose of energy upgrading their home (e.g. installation of photovoltaic systems, equipment, etc.).

New interest rate subsidies

1. Subsidy of 1% of the interest rate on housing loans granted to beneficiaries of the government's Housing Subsidy Scheme for Young Couples and/or Young People up to 41 years of age .

The subsidy will be provided on loans with a fixed interest rate for 3 years (i.e. currently from 3.60% for a contribution >30% to 2.60% and for a contribution <30% from 3.65% to 2.65% ).

It is understood that after the lapse of three years, the pricing will apply as agreed on the day the loan is concluded.

2. Subsidising the interest rate by 1% on housing loans granted to beneficiaries of the government's Housing Plan for the Revitalisation of Mountainous, Remote and Disadvantaged Areas.

The subsidy will be provided on loans with a fixed interest rate for 3 years (i.e. currently from 3.60% for a contribution >30% to 2.60% and for a contribution <30% from 3.65% to 2.65% ).

It is understood that after the lapse of three years, the pricing will apply as agreed on the day the loan is concluded.

3. Granting of mortgage loans for a total amount of €100 million for the acquisition of a first home worth up to €350 thousand with a fixed interest rate from 2.85% to 2.90% (depending on the customer's contribution) for 3 years.

It is understood that after the lapse of three years, the pricing will apply as agreed on the day the loan is concluded.

4. Granting 5,000 business loans of up to €5,000 to small businesses with a preferential fixed interest rate of 3% for a period of 5 years for energy or digital upgrade purposes.

CHARGES-COMMISSIONS

For customers aged 65+

• Free opening of a standing order at the cashier
• Free cash withdrawals with debit card from ATMs without charge from Bank of Cyprus (implemented in the first quarter of 2025)
• Free cash withdrawals from the teller for payment accounts with basic features.
• Savings Account – No Management Fees (for one account)
• Zero fees for paying utility bills either electronically or at the cashier.
• Free Chequebook Edition (implemented in the first quarter of 2025)

For customers aged 18-25

The Bank of Cyprus already has an account for young people 18-25 with the following features:

1. No management fees
2. Free subscription to a euro debit card
3. Free cash withdrawals in euros from ATMs internationally

New product for young people 18-25

In addition, a new Quick Account product in euros will be implemented in the 1st quarter of 2025 through electronic channels, for young people aged 18 to 25.

Features:

1. No management fees
2. Free subscription to a euro debit card
3. Free cash withdrawals in euros from ATMs internationally
4. Free cash withdrawals in foreign currency from ATMs internationally
5. No exchange fees for using the card in foreign currency

Automated Teller Machines (ATMs)

In collaboration with the government and the JCC, a number of ATMs will be installed in selected rural areas (within the 1st quarter).

The above measures will be implemented from 10/01/2025 unless otherwise stated.

It is noted that with the upcoming de-escalation of the ECB and Euribor reference interest rates, for each 1% interest rate reduction, the total reduction in interest for Bank of Cyprus customers will exceed €40 million annually.

In a statement, the Bank of Cyprus emphasises that it continues to substantially support Cypriot society, demonstrating in practice its social and economic role in the country. Indicatively, in the first nine months of 2024, record loans of €1.7 billion were granted.

At the same time, as he underlines, he continues to support and strengthen the Bank of Cyprus Oncology Center , the Cultural Foundation , SupportCY and the IDEA startup center .

It is noteworthy that an amount of more than €70 million has been allocated to date for the Oncology Center.