Official Statement of the Czech National Bank of 10 September 2026 on the Assessment of the Countercyclical Capital Buffer Rate for the Czech Republic – September 2026

Official Gazette of the CNB, Issue 6/2026 dated 11 September 2026 1 Sorting Code 2 0 9 2 6 1 8 0 Official Statement of the Czech National Bank dated 10 September 2026 on the assessment of the setting of the countercyclical capital buffer rate for the Czech Republic – September 2026

I.
Purpose of the Official Statement

The Czech National Bank (hereinafter referred to as the “CNB”) assesses the level of cyclical systemic risk pursuant to Section 12o(4) of Act No. 21/1992 Coll., on Banks, as subsequently amended (hereinafter referred to as the “Banking Act”) and Section 8al(4) of Act No. 87/1995 Coll., on Savings and Loan Cooperatives and Certain Measures Related Thereto and on Amending Act No. 586/1992 Coll., of the Czech National Council, on Income Taxes, as subsequently amended (hereinafter referred to as the “Savings and Loan Cooperatives Act”). Based on this assessment, the CNB may set or change the countercyclical capital buffer rate for the Czech Republic by issuing a measure of general nature pursuant to Section 12o(6) of the Banking Act and Section 8al(6) of the Savings and Loan Cooperatives Act.

Since the assessment conducted in September 2026 does not result in a change to the countercyclical capital buffer rate and therefore no measure of general nature is issued, the CNB publishes the justification for maintaining the countercyclical capital buffer rate for the Czech Republic at its unchanged level through this official statement.

II.
Justification for Maintaining the Countercyclical Capital Buffer Rate

1. In assessing the level of cyclical systemic risk and deciding on the countercyclical capital buffer rate for the Czech Republic, the CNB takes into account the indicative countercyclical capital buffer rate calculated pursuant to Section 12o(2) and (3) of the Banking Act and Section 8al(2) and (3) of the Savings and Loan Cooperatives Act, the recommendations issued by the European Systemic Risk Board (hereinafter referred to as the “ESRB”), and indicators that may signal an increase in systemic risk.

2. Pursuant to Section 12o(2) and (3) of the Banking Act and Section 8al(2) and (3) of the Savings and Loan Cooperatives Act, the basis for calculating the indicative indicator is the deviation of the ratio of the volume of loans granted to gross domestic product from the long-term trend. The value of the ratio of loans granted to gross domestic product in the first quarter of 2026 was 86.3%, and the respective deviation from the long-term trend reached -4.1 percentage points. 1 This value corresponds to a reference countercyclical capital buffer rate of 0%.

The additional deviation 2, which is based on the ESRB recommendation (Part B, para. 2) and better reflects the specifics of the Czech economy, reached 1.4 percentage points in the first quarter of 2026 and implies a reference rate of 0%.

3. In response to ESRB recommendations, the CNB has repeatedly emphasized that it does not consider the magnitude of the deviations mentioned in point 2 to be a reliable guide for determining the position of the domestic economy in the financial cycle and for setting the countercyclical capital buffer rate. The CNB prefers an approach based on a comprehensive assessment of the development of indicators signaling an increase in systemic risk pursuant to Section 12o(4) of the Banking Act and Section 8al(4) of the Savings and Loan Cooperatives Act. 3

4. The main indicator monitored is the Financial Cycle Indicator (FCI). Its continued growth confirmed that the Czech economy has moved further into the strongly growth phase of the financial cycle. The development of the FCI was driven primarily by the growth in the volume of net new loans contracted by the household sector for housing and consumption. In June 2026, their monthly volume exceeded 39.2 billion CZK and 14.8 billion CZK, respectively, placing them above the average for the years 2016–2025. The volume of loans drawn by the non-financial corporate sector also weighed more heavily on the FCI, reaching nearly 150 billion CZK in June 2026. The development of new loans was reflected in the year-on-year growth rate of the stock of outstanding bank loans and generally contributed to an increase in the indebtedness ratio via bank loans in both sectors. 4 The development of the FCI was also influenced by residential property prices, which rose briskly even at the beginning of 2026. 5

5. The overall scope of systemic cyclical risks in bank balance sheets can be viewed as increased, particularly in relation to the actual formation of loan loss provisions and the ratio of loan loss provisions to total loans. The updated estimate of the volume of potential unexpected cyclical credit losses has risen to 33.7 billion CZK. A source of systemic risk may also be the potential increase in risk weights for banks’ credit portfolios using the Internal Ratings-Based (IRB) approach, in the event of a more significant deterioration in the economic situation with systemic implications. A deterioration in risk parameters due to significantly adverse developments would lead to their increase and, indirectly, to an increase in the capital requirement in absolute terms. This potential increase should also be covered by the countercyclical capital buffer. The amount of capital needed to cover the decline in the capital ratio due to a possible cyclical increase in risk weights is estimated by the CNB at 37.4 billion CZK. The total additional capital needed to cover unexpected cyclical credit losses and the increase in risk weights is thus 71.1 billion CZK, which corresponds to a countercyclical capital buffer rate of 2.25%.

6. Based on the above assessment, the CNB Board of Directors decided to maintain the countercyclical capital buffer rate at 1.5%, which was set by General Measure I/2026 dated 4 June 2026. 6 Cyclical systemic risks continue to grow and credit activity remains strong across the main segments of the private non-financial sector. The CNB’s quantitative methods simultaneously indicate an increase in capital requirements. In its decision, the Board of Directors also took into account that the Financial Cycle Indicator sends a more moderate signal compared to quantitative methods, that the total indebtedness of households and non-financial corporations remains relatively low in relation to their income, and that banks are not broadly relaxing credit standards. Another factor for maintaining the CCyB rate is also the high profitability and capital adequacy of the banking sector. Given the recent changes in macroprudential 7 and monetary policy 8, the CNB Board of Directors considers it appropriate to wait for confirmation of the strength of current trends by further data that should already reflect these changes.

7. The circumstances and conditions described in points 4 to 6 allow the CNB to assess further macro-financial developments in light of domestic and global uncertainties and risks of the CNB summer forecast. If the strengthening of credit dynamics and the increase in indebtedness in both sectors of the real economy continue and lead to further movement in the growth phase of the financial cycle, the Board of Directors is prepared to further increase the countercyclical capital buffer rate, with the probability of this step having increased. Conversely, in the event of a significant deterioration in the economic situation and the emergence of significant unexpected cyclical credit losses in the domestic banking sector, it is prepared to reduce the countercyclical capital buffer rate or even release this reserve entirely in order to support smooth lending to the real economy.

III.
Final Provisions

This official statement was published on 11 September 2026.

Member of the Board of Directors:
PhDr. Jakub Seidler, Ph.D. sgd.
Section for Financial Stability and Restructuring

1 Pursuant to ESRB/2014/1 (Recommendation of the European Systemic Risk Board of 18 June 2014 on guidance for setting countercyclical buffer rates), the volume of loans is considered to be the value of all loans granted to the private sector (non-financial corporate sector, household sector, and non-profit institutions serving households), increased by the volume of bonds issued by the domestic private non-financial sector. For the calculation of the long-term trend of the ratio of the volume of loans granted to gross domestic product, a time series for the period from the fourth quarter of 1995 to the first quarter of 2026 is used, along with the Hodrick-Prescott filter with a smoothing parameter (λ) of 400,000. 2 The additional deviation, referred to as the expansive credit gap, is calculated as the difference between the current value of the ratio of bank loans to gross value added of the private non-financial sector and the minimum value of this ratio reached in the last 8 quarters. 3 The CNB’s methodological framework for setting the countercyclical capital buffer rate is presented in the document “CNB Approach to Setting the Countercyclical Capital Buffer Rate.” 4 As of 30 June 2026, the year-on-year growth rate of bank loans to households for housing was 9.6% and for consumption was 14.6%. The volume of bank loans to non-financial corporations increased by 9.6% year-on-year as of 30 June 2026. The ratio of bank loans to households to annual gross disposable income as of 31 March 2026 was 50.4%. The ratio of bank loans to non-financial corporations to annual gross operating surplus as of 31 March 2026 reached 75.1%. 5 The year-on-year change in the house price index (HPI) was 10.1% as of 31 March 2026.

6 General Measure I/2026 dated 4 June 2026 is available on the CNB website: General Measure I/2026 dated 4 June 2026.
7 CNB Recommendation on Investment Mortgage Loans and the announced increase in the CCyB rate to 1.5%.
8 Increase in the two-week repo rate by 0.25 percentage points to 3.75%.