Czech central bank lowers countercyclical capital buffer rate for banks

Moneta Money Bank, A.s

07/03/2024 14:45

PRAGUE, March 7 (Reuters) - The Czech National Bank's
(CNB) board decided to lower the countercyclical capital buffer
rate for banks by 25 basis points, to 1.75%, from April 1 as
cyclical systemic risks eased, the bank said on Thursday.
    "The decision took into account the position of the Czech
economy close to the bottom of the financial cycle, the size of
the credit risks accumulated in the banking sector’s balance
sheet and the evolution of the banking sector’s vulnerability,"
the bank said.
    It said the board also considered the sector's resilience
amid increasing structural systemic risks, which it will discuss
at a June meeting on financial stability and consider setting a
systemic risk buffer rate.
    The bank last cut the countercyclical capital buffer, which
is built up in periods of excessive loan growth, last September.
    With the Czech economy sputtering and high inflation
subsiding, the central bank began cutting its key interest rates
in December and delivered a 50 basis point reduction in February
to take the two-week repo rate to 6.25%.
    

 (Reporting by Jason Hovet)
 ((jason.hovet@thomsonreuters.com;))