## Cyprus: Financial Sector Assessment Program: Financial System Stability Assessment

_IMF Staff Country Reports, November 3, 2009_

## Source details

**Canonical URL:** [Cyprus: Financial Sector Assessment Program: Financial System Stability Assessment](https://www.imf.org/en/publications/cr/issues/2016/12/31/cyprus-financial-sector-assessment-program-financial-system-stability-assessment-23381)

## Other formats

- [Markdown version](/en/publications/cr/issues/2016/12/31/cyprus-financial-sector-assessment-program-financial-system-stability-assessment-23381/index.md)
- [Structured JSON version](/en/publications/cr/issues/2016/12/31/cyprus-financial-sector-assessment-program-financial-system-stability-assessment-23381/index.json)
- [Bundle manifest](/en/publications/cr/issues/2016/12/31/cyprus-financial-sector-assessment-program-financial-system-stability-assessment-23381/bundle-manifest.json)

## Bibliographic details
- Published: November 3, 2009
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781451809985.002

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### Executive summary and key findings
- The banking system of Cyprus "managed to avoid the worst effects of the global financial crisis."
- Stress tests confirmed that "credit risk remains high."
- The assessment recommends that work on the "crisis contingency framework should be completed."

### Main analysis points
- Stress testing and simulation exercises were used to assess resilience; results indicated elevated credit risk despite avoidance of the worst crisis outcomes.
- The assessment highlights the need for stronger contingency arrangements at both national and EU levels to address potential systemic stress.

### Policy recommendations and ongoing initiatives
- Complete the crisis contingency framework.
- EU-wide and national initiatives already under way include:
  - Strengthening deposit insurance.
  - Drafting guidelines for emergency liquidity assistance.
  - Adopting a legal framework for covered bonds to facilitate access to European Central Bank refinancing.

### Subjects and technical scope
- Subject areas covered: Banking; Commercial banks; Cooperative banks; Financial institutions; Financial Sector Assessment Program; Financial sector policy and analysis; Loans; Stress testing.
- Keywords: bank; banking sector; central bank; Commercial banks; Cooperative banks; CR; Cypriot authorities; Cypriot bank; Cyprus; EU accession; EU banking directive; EU member; Europe; Financial Sector Assessment Program; financial system; Global; ISCR; Loans; return on assets; simulation exercise; Stress testing.

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## Content in this bundle

- **Cyprus — Financial System Stability Assessment**
  - [Cyprus — Financial System Stability Assessment (Markdown version)](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2009/_cr09308.pdf.md){rel="alternate" type="text/markdown"}
  - [Cyprus — Financial System Stability Assessment (PDF)](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2009/_cr09308.pdf){rel="external" type="application/pdf"}

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_Source: https://www.imf.org/en/publications/cr/issues/2016/12/31/cyprus-financial-sector-assessment-program-financial-system-stability-assessment-23381_