The Czech National Bank’s Bank Board left the countercyclical capital buffer for banks’ and credit unions’ Czech exposures at 1.5%, following its June increase to that level. The board judged that the rate currently covers risks from the economy’s expansionary position in the financial cycle, but said the likelihood of a further increase has risen. Strong household credit growth continued in the first half of 2026, partly reflecting borrowing ahead of tighter investment mortgage conditions and expected interest rate increases, while corporate investment lending also strengthened. Although cyclical systemic risks are increasing, household and corporate indebtedness remains moderate by historical standards, banks have not broadly eased credit standards, and the sector remains profitable and strongly capitalized. The board stands ready to raise the buffer if credit growth and indebtedness continue to increase. Further details will be published on Sept. 11, 2026, and the board will next review the buffer in November 2026.
2026-09-10Czech National Bank
Czech National Bank holds countercyclical capital buffer at 1.5%, signals increased likelihood of further increase
The Czech National Bank held the countercyclical capital buffer at 1.5% after raising it to that level in June. Strong household and corporate credit growth has increased cyclical risks, and the board said the likelihood of a further buffer increase has risen.