Minutes of the CNB Bank Board meeting on financial stability issues on 4 June 2026

Present at the meeting: Aleš Michl, Eva Zamrazilová, Jan Frait, Karina Kubelková, Jan Procházka, Jakub Seidler

The meeting opened with a presentation given by the Financial Stability and Resolution Department summarising the main conclusions of Financial Stability Report – Spring 2026. The presentation focused on an assessment of the position of the domestic economy in the financial cycle, the evolution of risks of a structural nature, and an evaluation of risks associated with the debt financing of residential property amid continued growth in house prices. In addition, the Department presented the results of a banking sector stress test and related sensitivity analyses. Using this background material, the Bank Board then evaluated the current risks to financial stability and discussed the appropriate calibration of macroprudential policy instruments – the countercyclical buffer, the systemic risk buffer and borrower-based measures (upper limits on the LTV, DSTI and DTI ratios).

The countercyclical buffer (CCyB) rate

In the part of the meeting dealing with the CCyB rate, the Financial Stability and Resolution Department stated that despite the macroeconomic uncertainties, the domestic economy was shifting further into the growth phase of the financial cycle. This was evidenced by strong credit growth across all key credit segments, which was increasing the debt ratios of households and non-financial corporations. Besides continued growth in residential property prices, other typical features of a shift of the economy into the growth phase of the cycle were visible. These included lower coverage of loans by provisions, a decline in average risk weights on exposures and optimistic assessment of credit risk in an environment of low credit risk materialisation.

The Board agreed with the Department’s conclusions and assessed the new incoming data as confirmation of a further shift of the domestic economy into the growth phase of the financial cycle. Credit growth had strengthened across the board even when adjusted for the one-off effect of frontloading before banks had begun to follow the recommendation for the provision of mortgage loans for investment purposes (Eva Zamrazilová, Jakub Seidler). A shift of the economy further into the growth phase of the cycle was also evidenced by other indicators, such as a strong credit impulse and faster credit growth than nominal GDP growth (Jakub Seidler), as well as a very low non-performing loan ratio. The latter could foster over-optimistic perceptions of the current degree of credit risk, owing to dilution of the portfolio by strong inflows of new loans (Jan Frait). In the discussion, Jan Procházka emphasised that the expectations of a slowdown in the growth of residential property prices might also be quite optimistic and that the price growth outlook was subject to upside risks.

In summary, the board members agreed that the appropriate response to the accumulation of credit risks associated with the shift of the economy further into the growth phase of the financial cycle was to raise the CCyB rate. Given the amount of voluntarily held capital and the solid profitability of the banking sector, this step would not have a material impact on lending to the real economy. At the same time, though, it was said that the further evolution of the economy was subject to considerable uncertainty due to persisting geopolitical risks and accompanying supply shocks. This made it more difficult to time and calibrate this step. However, the prevailing view was that the CNB could react very flexibly to any deterioration in economic conditions and release the buffer to cover potential credit losses if the need arose (Eva Zamrazilová, Karina Kubelková, Jakub Seidler).

After the discussion, the Board decided to increase the CCyB rate by 0.25 pp to 1.50%. All six board members present (Aleš Michl, Eva Zamrazilová, Jan Frait, Karina Kubelková, Jan Procházka, Jakub Seidler) voted in favour of this decision.

The systemic risk buffer (SyRB) rate

In the part of the presentation on the assessment of structural risks, the Financial Stability and Resolution Department said that the initial situation had changed little since the previous evaluation. Owing to its high degree of openness, the domestic economy remained very sensitive to adverse international developments, including the effects of geopolitical shocks. Foreign trade and product categories were still highly concentrated in territorial terms, and economic activity and employment likewise remained concentrated in a few key sectors. Other ongoing structural trends, such as the transition to a carbon-free economy, technological change and its impact on labour productivity, and growth in cyber risks, could amplify the effects of adverse shocks. The results of banking sector stress tests covering the materialisation of structural risks associated with the openness and concentration of the domestic economy signalled that the buffer plays an important role in safeguarding the long-term stability of the banking sector.

In its assessment of structural risks, the Board agreed with the Department’s opinion. Structural risks remained relevant and some of them might strengthen further. Karina Kubelková highlighted the increasing role of cyber risks and AI-related risks, which could pose a significant challenge for the financial sector and would require active cooperation between micro- and macro-supervision in assessing their potential impacts. She also emphasised that these risks had not been included in the current round of stress tests and would have to be revisited in testing in the near future. Jan Procházka pointed out that the non-bank financial sector was gradually increasing in importance. Against a backdrop of ongoing changes in the area of financial innovation, the links between banks and other financial institutions were likely to continue strengthening, contributing to higher interconnectedness between cyclical and structural risks. In this regard, Jakub Seidler said that the close relationship between the two types of risks posed a challenge as regards deciding to use or release individual macroprudential capital buffers in the given conditions. In the ensuing discussion, Jan Frait noted that the growing importance of the non-bank financial sector was linked in part with structural changes in the allocation of households’ savings. In the longer term, these could, among other things, cause banks’ cost of funding to increase, due to partial migration of low-interest deposits from households to institutional investors and alternative assets. It would therefore be necessary to further analyse the implications of the growth of the non-bank financial sector in a broad context in the coming years.

After its discussion, the Board decided to leave the SyRB rate at 0.5%. All six board members present (Aleš Michl, Eva Zamrazilová, Jan Frait, Karina Kubelková, Jan Procházka, Jakub Seidler) voted in favour of this decision.

Legally binding borrower-based measures

In the next part of the meeting, the presentation given by the Financial Stability and Resolution Department focused on the mortgage market situation. It was said that numbers of newly negotiated mortgage loans had been above the long-term average in the first few months of 2026, while volumes had exceeded the record year 2021 due to continued growth in residential property prices. This had partly reflected frontloading in response to the CNB’s recommendation on the provision of loans to finance investment property, which had applied to lenders since April. The increased volume of mortgage loans provided had not been accompanied by a broad easing of banks’ credit standards, and the sector had remained compliant with the binding LTV limits. The DTI and DSTI ratios had moved partially towards riskier levels, but loans with riskier ratios had been provided mostly to households with above-average incomes, who have sufficient financial reserves to absorb macrofinancial shocks.

The Board’s assessment of the risks associated with the mortgage market aligned with the opinion of the Financial Stability and Resolution Department. The board members agreed that for now, the partial deterioration in DTI and DSTI risk characteristics did not signal a broad easing of banks’ credit standards. The growth in mortgage loans was concentrated among high-income households and might have been connected largely with efforts by some households to obtain a mortgage loan for the purchase of an investment property before lenders began to apply the stricter recommended LTV and DTI caps for this type of loan. Most of the board members nonetheless emphasised that it would be necessary after some time had passed to assess in detail the extent to which the recommendation had achieved its purpose of mitigating the risk of the mortgage portfolio and to analyse whether the measures taken had been sufficient to maintain financial stability in the long term. In the discussion, Eva Zamrazilová also mentioned the need to evaluate the domestic calibration of the borrower-based measures in the international context, especially in comparison with other EU countries. There was a need to continuously examine whether the reasons for deactivating the income-based ratios had ceased to exist. Jan Frait and Jakub Seidler added that in accordance with macroprudential regulation, activation of the DTI and DSTI limits could be an inevitable response in the event of a sustained easing of credit standards to levels implying significantly elevated systemic risks. According to Jan Frait, however, it would be necessary to carefully weigh the benefits (mortgage portfolio quality) and costs (distributional side effects) of such action. In this context, Jan Procházka said he regarded LTV as the key ratio. He viewed the introduction of DTI and DSTI caps primarily as a safeguard in an environment of very low interest rates, as a potential sizeable future increase in rates could have a substantial effect on households’ ability to service their loans. He also pointed to the fact that analyses were not indicating any systematic circumvention of the legally binding limits or recommendations through undesirable practices (such as meeting the LTV cap by simultaneously providing an unsecured consumer loan). The assessment of the riskiness of newly granted loans should therefore not be significantly distorted.

After the discussion, the Board decided to leave the upper LTV limit at 80% (90% for applicants under 36 years purchasing owner-occupied housing). All six board members present (Aleš Michl, Eva Zamrazilová, Jan Frait, Karina Kubelková, Jan Procházka, Jakub Seidler) voted to leave the legally binding upper LTV limit at this level. The legally binding upper DTI and DSTI limits remain deactivated. The Board also left the current Recommendation on the management of risks associated with the provision of consumer credit for housing unchanged.

Author of the minutes: Miroslav Plašil, Financial Stability and Resolution Department