News Economy Moody's: Cyprus Bank rating will go up

Moody's: Cyprus Bank rating will go up

Moody’s positively rates the insolvency bill, after the vote in parliament.

According to the rating agency, Cypriot banks will benefit in their ratings from the divestiture bill.

Moody’s says the law puts in place a major importance on loan restructuring and this will increase the recovery prospects of banks.

The law will provide motivation for private owners to restructure their loans and discourage them for filing for strategic bankruptcy, in accordance with the rating agency’s evaluation of the law.  The banks will be able to better deal with the volume of non-performing loans in line with the insolvency framework.

Moody’s noted the slow rate of restructuring until now because the people and businesses were waiting for the changes to come from the open political dialogue around the divestitures and implementation of the framework.