Moody's upgrades Bank of Cyprus

Moody's Investors Service said it upgraded Bank of Cyprus PCL’s senior unsecured and subordinated ratings to B3 from Caa1, among other upgrades.

“The upgrade of Bank of Cyprus' ratings and assessments reflects significant ongoing improvement in the bank's asset quality following its agreement to sell a portfolio of nonperforming loans (in a transaction termed Helix 3) with a gross book value of €568 million, as well as real estate properties with a book value of around €120 million. Moody's believes there is a very high probability that Helix 3 will be concluded in the first half of 2022, which will reduce Bank of Cyprus' stock of nonperforming exposures (NPEs) to a pro forma 8.6% as of September 2021, from 13.3% excluding the transaction,” Moody’s said in a press release.

The bank plans to reduce the NPE ratio to under 5% in the medium-term, the agency noted.

The outlook is positive.

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