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Bank of Cyprus posts profit in 1st quarter of 2015

Xinhua, May 30, 2015 Adjust font size:

Bank of Cyprus reported a 29-million-euro (31.9 million U.S. dollar) profit in the first quarter of 2015, compared with a loss of 337 million euros (370 million U.S. dollars) in previous quarter.

The bank was forced by Cyprus's international lenders to seize 47.5 percent of large deposits to recapitalize after suffering huge losses on account of its exposure to the devalued Greek sovereign bonds in 2012.

The Bank's statement said its main problem remains the high percentage of nonperforming loans, which reached 63 percent of its loan portfolio.

"The Bank's financial performance is highly correlated to the economic conditions in Cyprus. The Cyprus economy is showing further signs of stabilization amid a relatively unfavorable external environment," the statement added.

It said initial estimates for the first quarter of 2015 showed the island's Gross Domestic Product increased by 0.2 percent from the previous quarter, ending 14 consecutive quarters of negative economic growth.

It added that it expected economic performance to be driven upwards by the flexibility of the economy as shown by declining prices and wages, the resilience of sectors such as tourism and international business services and the stabilization tendencies in the banking sector.

Cyprus had been in recession since mid-2011 and received bailout assistance by the Eurogroup and the International Monetary Fund in March, 2013, after being shut out of international markets for over a year. Endi