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Countercyclical capital buffer (CCyB)


The countercyclical capital buffer (CCyB) rate for the period  1 July 2022 – 30 September 2022 remains at 0%.

The Central Bank of Cyprus (CBC), in accordance with the methodology described in its macroprudential policy, did not deem necessary to adjust the CCyB rate for the period 1 July 2022 – 30 September 2022 and, therefore, the CCyB rate remains at 0% of the total risk exposure amount of each licensed credit institution in the Republic.

Based on the time series ending on 30 December 2021:

  • The gap between the credit-to-GDP ratio and its long term trend (credit-to-GDP gap) based on the broad credit definition is -62,9.
  • The gap between the credit-to-GDP ratio and its long term trend (credit-to-GDP gap) based on the narrow (bank) credit definition is -54,3.

Given that the credit-to-GDP gap is lower than 2 percentage points and taking into account the additional indicators that were assessed by the CBC, the benchmark buffer guide is 0% and the CCyB rate remains at 0%.

In addition to the credit-to-GDP gap, the CBC takes into account a range of quantitative and qualitative information in its assessment of system-wide risks associated with periods of excessive growth.  The additional indicators assessed by the CBC relate to:  Non-financial private sector indebtedness; banking sector resilience; the real estate market; the real economy; and external imbalances. The summary table of indicators used by the CBC is set out in this file.

Additional information on the CCyB, which, since its introduction on 1 January 2016, has been set on a quarterly basis, is provided in this file.