Banks are looking for ways to increase revenue and service fees and commission seem to be the way to improve their balance sheets.
Data for the first half of 2019 for Bank of Cyprus and Hellenic Bank and Alpha Bank’s 2018 annual results shows that revenue from service fees and commission remains relatively stable. Bank of Cyprus’ net income from fees and commission in the first half of 2019 was €75 million compared to €80 million in 2018.
Hellenic Bank’s net fees and commission income was €24.26 million in the first half of 2019 compared to €20.73 million in 2018. Alpha Bank Cyprus’ net fee and commission income was €6.94 million in 2018 compared to €6.19 million in 2017.
Based on Central Bank of Cyprus data, the overall banking system’s net fee and commission income in the first quarter of 2019 was €67.69 million compared to € 292.79 million in 2018. Net fees were €337 million in 2017 and €323.35 million in 2016.
In the meantime, bank managers are now in search of a new balance in their customer relationships. The goal is to enhance sources of profitability and limit the number of branches. That’s why they now charge even for simple and basic services such as cash withdrawals.
The two largest banks with the biggest market share – Bank of Cyprus and Hellenic Bank – are seeking to boost e-banking by significantly reducing transaction costs during a time of reduced revenue due to low interest rates and high salary costs.
As from June 2019, Bank of Cyprus already applied charges for various services and Hellenic Bank followed suit in September. These services are free via the bank’s website.
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Read more:
https://in-cyprus.com/three-main-challenges-for-banks-in-cyprus/
