CBC aims for flexibility and innovation in 2025-2026 strategy

The Central Bank of Cyprus (CBC) this week announced an ambitious transformation plan under its newly released strategy for 2025-2026.

This initiative, outlined in a 13-page document, aims to create a more flexible, modern, and sustainable central bank that meets emerging challenges in the European financial landscape.

Moreover, the strategy seeks to strengthen the institution’s adaptability to economic, technological, and environmental shifts.

With 76 specific strategic actions, the CBC intends to support the long-term growth and stability of the Cypriot economy and enhance its integration within the European framework.

In his introductory remarks, CBC governor Christodoulos Patsalides highlighted the rapidly changing economic, social, technological, and geopolitical landscape as critical factors in the bank’s decision to forge new policies and take proactive steps.

“Our bank must transform at a swift pace to keep up with the demands of the times, ultimately benefiting both the Cypriot economy and the broader European family,” he stated.

The CBC’s strategic direction is structured around three core pillars, titled ‘Fix the Bank’, ‘Run the Bank’, and ‘Change the Bank’.

Pillar 1: Fix the Bank

The first pillar, ‘Fix the Bank’, prioritises the internal strengthening and reorganisation of the CBC, laying the groundwork for enhanced effectiveness and speed in executing its mandate.

The CBC plans to implement a modern organisational structure that will allow it to respond comprehensively and efficiently.

Key components of this pillar include bolstering risk management, ensuring regulatory compliance, enhancing internal controls, and updating the bank’s business continuity and recovery plans.

The plan also focuses on updating CBC’s policies, methodologies, and processes to reinforce its internal control systems.

A core part of this initiative is a human resources audit to identify skill gaps and align CBC’s workforce with industry best practices.

The CBC also aims to map its technological capabilities and introduce a supportive IT strategy.

Further, the ‘Fix the Bank’ pillar includes a communications strategy, a renovation and energy efficiency upgrade for CBC’s facilities, and plans to showcase the bank’s numismatic collection.

Pillar 2: Run the Bank

The second pillar, ‘Run the Bank’, focuses on optimising the day-to-day operations of the CBC.

This will involve a supervisory strategy tailored to each of CBC’s areas of responsibility, guiding the institution’s operations through a structured, methodical, and long-term approach.

In alignment with this pillar, the CBC will also be enhancing its staffing, addressing climate change issues, supporting green transition efforts, and promoting environmental literacy.

This pillar includes establishing a dedicated procurement unit to optimise resource management and an increased focus on CBC’s responsibilities as Cyprus takes on the EU Council Presidency.

These steps, the document explained, aim to help the CBC meet its operational duties with renewed effectiveness and consistency.

Pillar 3: Change the Bank

The final pillar, ‘Change the Bank’, is designed to drive modernisation within the CBC, fostering a culture of innovation and adaptability.

This includes overhauling CBC’s governance model, implementing strategies for human resources development that promote excellence, and advancing its IT framework to improve overall efficiency and flexibility.

The CBC also aims to establish a Centre for Research and Policy Development, enhancing its influence and contribution across its various domains.

The bank also said that it is committed to social responsibility, environmental sustainability, and supporting citizens.

Each of these themes within the ‘Change the Bank’ pillar comprises specific actions intended to position the CBC as a more responsive and innovative central bank.

Implementation and progress monitoring

The CBC’s 2025-2026 Strategic Plan consists of 76 targeted actions, each assigned to a project leader responsible for its implementation.

For each action, a detailed project plan and timeline have been established, ensuring that all steps are carefully monitored.

The CBC’s coordinating team will oversee progress through monthly status reports, keeping track of accomplishments and ensuring accountability at every stage.

It should be noted that to meet the targets set out in the strategy, the CBC has already begun work on certain actions.

By the end of 2024, the CBC expects to complete 33 of the 76 actions, while an additional 20 actions are set to conclude in the first half of 2025, with three more scheduled for completion by the end of 2025.

The bank said that the remaining 20 actions will follow shortly after, as part of the CBC’s ongoing efforts to solidify its position as a modern central bank.

Governor Patsalides summarised the CBC’s ambitions, by saying that “our goal is to raise the bar in fulfilling our role and to evolve into a model organisation dedicated to service and excellence”.