As we reflect on the past year and look ahead to the future, the banking sector in Cyprus continues to navigate an evolving landscape marked by both challenges and opportunities. The global economic environment, digital transformation, regulatory framework and shifting customer expectations are shaping the way banks operate and deliver services with a crucial role for the local economy and society.
The local banking sector has demonstrated resilience in the face of uncertainty, reinforcing stability and trust in the financial system with direct effect to the economy. In the past year, banks have continued their efforts to strengthen capital buffers, improve governance, and enhance risk management frameworks. These steps have positioned the industry on a solid footing to support economic growth and meet the needs of businesses, households and individuals alike.
Digital is key
One of themost significant transformations in banking is digitalization. Technological advancements are redefining how financial services are accessed and delivered, with a growing focus on convenience, security, and innovation.
The shift towards digital banking is accelerating, driven by increasing customer demand for seamless and efficient banking transactions (i.e. deposits, withdrawals, payments, online shopping). As an industry, we are committed to ensuring that this transition is inclusive, secure, and beneficial for all stakeholders. Concurrently, efforts are being made to address the specific needs of older customers, ensuring they have access to traditional banking services while also facilitating their transition to digital solutions.
Ongoing efforts
Furthermore, regulatory developments at both the European and national levels unfold at a brisk pace. Compliance with evolving standards, particularly in areas such as Anti-money Laundering and Terrorism Finance (AML/TF), sustainable finance, and consumer protection, remains a top priority. Banks in Cyprus are fully aligned with these efforts, reinforcing their role as responsible financial intermediaries contributing to a stable and transparent economic environment. sUsTAINAbILITY is also at the forefront of banking strategies. Environmental, social, and governance principles (ESG) are becoming crucial to decision-making processes, influencing investment strategies, risk assessments and corporate policies. Banks in Cyprus are increasingly embracing green finance initiatives, supporting projects that support sustainability and contribute to a more resilient future.
The way forward
O a personal note, as this marks my final year as Director General of the Association, I would like to take the opportunity to thank our Board of Directors for their trust and support, as well as the staff of the Association for their dedication and loyalty. After XX years at the Association, looking back it is evident that the banking landscape today bears no resemblance to the one in the 1980’s.
Banking institutions as well as their supervision are resting on much stronger foundations and are well positioned to withstand the new challenges stemming from global instability. Looking ahead, the banking sector will continue to serve as a pillar of economic progress, stability and prosperity for the benefit of the society, the environment and the economy in general.
As I prepare to conclude my tenure at the Association, I do so with a deep sense of pride in how far the sector has come and with optimism for the future — even as complex challenges have become the new norm. The transformation of the banking sector over the decades has been remarkable, from localised, traditional operations to dynamic institutions embedded in a global financial system. Today, banks in Cyprus are better capitalised, technologically advanced, and more attuned to the needs of society and the environment than ever before. The Association of Cyprus Banks will continue to play a key role in this journey -fostering cooperation, advocating for sound policy, and promoting innovation and resilience as the sector navigates the road ahead. It is through shared purpose and strong institutions that we will continue to build a banking system that supports a sustainable and inclusive future.
In an era defined by uncertainty and rapid changes, stability, resilience, and long-term vision are not just aspirations; they are necessities. Banks in Cyprus serve as a typical example of these qualities, navigating through complexity with prudence and purpose. Despite the challenges at multiple levels, the sector remains on a steady course, steering toward safe waters.
