In our previous article on deposit rates (Cyprus Banks Deposit Rates),we compared the general economic landscape in Cyprus to that of the European Union, highlighting how Cyprus banks offer some of the lowest deposit rates in the region. This follow-up article provides a detailed, analytical look at the current deposit rates offered by major banks in Cyprus as of June 2024. Cyprus ranks second to last with an average of 1.4%, with the Euro Area average being close to 3% and the highest being in Estonia with the deposit rate of 3.8%. In Cyprus rates in deposit accounts start at 0.03% (Bank of Cyprus) and go up to 2.25% for deposits over €70,000 (Alpha Bank). Despite having excess cash and housing loan interest rates that average around 4.50%, making them among the highest in Europe, banks still provide customers with unreasonably low deposit rates keeping a large gap between savings and mortgage rates.
Take a look at the deposit rates currently offered by banks in Cyprus.
Bank of Cyprus:
Lowest Interest Rate: 0.03% (e-Notice 90 Days)
Highest Interest Rate: 0.12% (Children's Savings Account)
Minimum Deposit: €1,000 for fixed deposits, €30 for savings accounts
Hellenic Bank:
Lowest Interest Rate: 0.02% (Notice Accounts up to 3 months)
Highest Interest Rate: 1.50% (18-month Fixed Deposit, ≥ €20,000)
Minimum Deposit: €1,000 for fixed deposits, €20,000 for 18-month fixed deposit
Alpha Bank:
Lowest Interest Rate: 0.25% (3 Months Fixed Deposit)
Highest Interest Rate: 2.25% (12 Months Fixed Deposit, ≥ €70,000)
Minimum Deposit: €1,000 for fixed deposits
National Bank of Greece (Cyprus):
Lowest Interest Rate: 0.30% (3 Months Fixed Deposit)
Highest Interest Rate: 1.10% (24 Months Fixed Deposit)
Minimum Deposit: Not specified
AstroBank:
Lowest Interest Rate: 0.02% (Notice Accounts up to 90 Days)
Highest Interest Rate: 1.50% (18 Months Fixed Deposit)
Minimum Deposit: Not specified
Ancoria Bank:
Lowest Interest Rate: 0.50% (3 Months Fixed Deposit)
Highest Interest Rate: 2.00% (12 Months Fixed Deposit)
Minimum Deposit: €500
The deposit rates offered by Cypriot banks remain extremely low compared to the rest of the European Union, where rates are generally higher due to more competitive economic conditions. This situation presents a significant challenge for savers in Cyprus, who are struggling to find secure yet rewarding places to grow their money and keep up with high inflation. The conservative approach of Cypriot banks in offering such low-interest rates is discouraging for depositors. Banks need to reassess their strategies and provide more attractive rates to foster savings and stimulate economic growth. The current rates do not even outpace inflation, making it difficult for savers to achieve real returns on their deposits.
Given the unattractive deposit rates in Cyprus, savers should consider exploring alternative investment options. This could include looking into other European banks with higher interest rates, investment in bonds, mutual funds, or other financial instruments that offer better returns. By diversifying their investments, savers can potentially achieve higher returns while managing risk more effectively. In this high inflation environment, it's crucial for savers to keep pace with rising costs and preserve their purchasing power.
No matter what decision you make, be sure to consult a professional for guidance. Please read our latest article for more information on how deposit rates impact your savings and explore the alternatives available to savers. Cyprus Banks Deposit Rates
