The Cypriot banking sector remains stable with no signs of capital flight or panic withdrawals following the recent drone attack on the British Bases at Akrotiri and the war raging in the Middle East.
Data from systemic lenders and the Central Bank of Cyprus (CBC) indicate that cash withdrawals at both branches and ATMs have remained within normal daily parameters. Banking officials confirmed to Phileleftheros that the geopolitical volatility of the past week has failed to trigger the mass liquidity pressure often seen during periods of regional unrest.
The flow of transactions is evolving smoothly, a banking source stated, noting that current activity is driven by routine household and business needs rather than security concerns. Analysts suggest that the maturity of the Cypriot depositor base—shaped by the financial experiences of the previous decade—has resulted in a more measured response to external shocks.
Liquidity and currency profile
The resilience of the system is backed by a robust liquidity buffer. According to the latest CBC report released on 29 January 2026, total deposits in the Republic reached €56.9 billion.
The vast majority of these funds, approximately €50.8 billion, are held in euros. However, the system maintains a diverse foreign currency profile:
- US Dollars (USD): €5.00 billion
- British Pounds (GBP): €742.4 million
- Swiss Francs (CHF): €47.2 million
- Japanese Yen (JPY): €9.3 million
Household dominance
Retail depositors continue to underpin the stability of the national economy. Households account for 59% of total deposits, valued at €33.6 billion. Non-financial corporations follow with €14.16 billion, while the general government and investment funds hold €2.19 billion and €6.01 billion respectively.