Fitch raises Cyprus' credit rating to investment grade

International agency Fitch has raised Cyprus' credit rating by one notch to BBB-, elevating the Mediterranean island nation back into investment grade more than five years after a financial crisis nearly drove it into bankruptcy.

Fitch said Friday that high fiscal surpluses above 2 percent of gross domestic product until 2020, coupled with robust economic growth reaching 4 percent and 3.9 percent of GDP this year and next respectively were key reasons for the rating upgrade.

The agency also cited steps taken to reduce the banking system's significant bad debt load including the Cyprus-based Hellenic Bank's takeover of the troubled Cooperative Bank. It also said the country's public debt will remain on a downward trajectory.

Standard & Poor's was first in lifting Cyprus back into investment grade last month.