In 2024, Bank of Cyprus reports a €508 million profit, a 6% rise in deposits, and proposes a €211 million dividend. Discover the financial highlights.
In a remarkable display of financial prowess, the Bank of Cyprus has reported a profit of €508 million for the fiscal year 2024, marking a commendable 4% increase from the previous year. This impressive figure is complemented by a proposed distribution of €211 million in cash dividends, alongside share buybacks totaling €30 million. Such a distribution not only underscores the bank’s robust financial health but also reflects a significant enhancement in both the payout ratio and the total amount disbursed compared to the preceding year.
The bank’s financial metrics reveal a year of substantial growth, with deposits rising by 6% year-on-year and record new borrowings reaching €2.4 billion, a staggering 20% increase. The performing loan portfolio has also seen a healthy uptick, now standing at €10.2 billion, which is a 4% rise from the previous year. The Return on Tangible Equity (ROTE) has impressively surpassed 20% for two consecutive years, while net interest income has climbed to €822 million, reflecting a 4% increase year-on-year.
However, the fourth quarter of 2024 did present some challenges, with net interest income dipping by 3% quarter-on-quarter to €198 million, primarily due to a decrease in interest rates. Operating expenses have risen to €367 million, an 8% increase attributed to heightened investments in staff, technology, and marketing initiatives. Despite these rising costs, the bank maintains a commendably low cost-to-income ratio of 34%, which increased to 38% in the fourth quarter, largely due to seasonal factors.
The bank’s balance sheet remains robust, characterized by high liquidity and a commendable loan portfolio quality. The non-performing loan (NPL) ratio has decreased to 1.9%, with an NPL coverage ratio of 111%. The deposit base, predominantly retail, has expanded to €20.5 billion, reflecting a 6% year-on-year growth. Furthermore, the bank’s liquidity position is fortified with €7.6 billion held at the European Central Bank.
In terms of capital adequacy, the Bank of Cyprus boasts a Common Equity Tier 1 (CET1) ratio of 19.2% and a Total Capital Adequacy Ratio of 24.0%, both of which are calculated for supervisory purposes. The capital generation for CET1 reached an impressive 400 basis points for the year ending December 31, 2024. The tangible book value per share has also seen a significant increase, now at €5.775, reflecting a 17% year-on-year growth.
In a strategic move to reward shareholders, the Bank of Cyprus Holdings Public Limited Company has proposed a payout ratio of 50% for the year ended December 31, 2024. This proposal aligns with the Group’s Distribution Policy and is indicative of the bank’s strong financial performance and commitment to delivering consistent returns to its shareholders. The total distribution of €241 million, comprising a cash dividend of €211 million and share buybacks of up to €30 million, translates to a distribution yield of 12%, surpassing the Eurozone banking average for 2024.
The Bank of Cyprus has not only demonstrated resilience in a fluctuating economic landscape but has also positioned itself as a formidable player in the banking sector, with a clear commitment to enhancing shareholder value while maintaining a robust capital position.
