Minutes of the CNB Bank Board meeting on financial stability issues on 5 March 2026

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

The countercyclical buffer (CCyB) rate

The meeting opened with a presentation given by the Financial Stability and Resolution Department on the CCyB rate. The favourable economic developments had been reflected in the financial cycle, which had moved further into its expansionary phase. The level of cyclical systemic risks was increasing slightly, and the financial cycle indicator was signalling a CCyB rate of 1.25% one year ahead. However, the risk relating to the projection for the indicator was skewed towards higher values. In addition to growth in pure new loans to households and property prices, an increase in credit activity among non-financial corporations had contributed to the upward shift. The volume of loans relative to the incomes of households and corporations was close to its long-term averages. The estimated buffer rate needed to cover unexpected cyclical credit losses and the effect of growth in risk weights had not changed materially since the previous assessment and was indicating a rate of 1.5% overall. As the banking sector was not yet relaxing market credit standards to any significant extent and cyclical credit risks were accumulating only gradually, the Department recommended holding the CCyB rate at 1.25%, adding that considerations about a rate increase were becoming more relevant.

In the ensuing discussion, the board members agreed that the financial cycle was in an expansionary phase, with sustained growth in lending to households being accompanied by a revival in credit activity among non-financial corporations. Cyclical risks were thus rising moderately but remained sufficiently covered by the current CCyB rate. The Board also agreed that if the economy continued to move further into the expansionary phase of the financial cycle, the likelihood of a rate increase would rise.

Jan Frait said that the observed developments were consistent with a standard credit cycle. Economic activity was accelerating, sentiment was improving and the willingness of economic agents and sectors to take on more debt was rising. Nominal and real credit growth was picking up across sectors, while current measures of credit risks were not rising – such risks typically materialise in the subsequent phase of the cycle. If this trend were to continue, it would naturally lead to a situation in which the macroprudential authority should raise the rate. This was fully consistent with the Methodology for setting the CCyB rate and with the CNB’s communications, and should not come as a surprise to anyone. He said that if the expected further shift in the expansionary phase of the financial cycle were to be confirmed at the next meeting, he would be inclined to support a rate increase of a quarter of a percentage point. At the same time, however, he noted that the current geopolitical situation introduced a high degree of uncertainty into the decision-making process.

Jakub Seidler said that the rise in the financial cycle indicator was being driven largely by households, and especially by house purchase loans. However, he did not regard this factor as sufficient grounds for increasing the buffer, as he considered mortgage loans to be well secured. According to financial stability analyses, credit risk was not increasing due to an elevated volume of refixes at higher interest rates either. Although credit growth was high in nominal terms, from the perspective of the credit-to-GDP ratio there was no major growth and the situation appeared stable. However, credit activity was becoming more broad-based and was increasing among non-financial corporations as well, signalling a further upward movement of the economy in the expansionary phase of the financial cycle. Given the relatively conservative calibration of the quantitative methods, he agreed with the Department’s proposal to leave the rate at 1.25%. If incoming data were to indicate more robust growth in cyclical risks, including one year ahead, he would consider a modest increase justified.

Karina Kubelková stated that she accepted the results of the quantitative methods and the overall assessment of the current situation. In view of the level of credit activity relative to income, the indebtedness of non-financial corporations and households, and the low materialisation of risks, she agreed that there was currently no need to raise the rate. At the same time, she shared the view that the risk relating to the path of the financial cycle was skewed towards higher risk accumulation. She proposed waiting until the next meeting – when new data from early 2026 would be available – before considering a rate increase.

Jan Procházka said that, given the rise in property prices and the overall price level, the current situation should not be compared with historical developments in nominal terms alone. He agreed with the Department’s recommendation to hold the rate at 1.25%. However, he considered it important to carefully consider all the risks that could arise from the relatively high nominal pace of growth of credit to households. From a methodological perspective, he said it was appropriate to assess the information content of the credit-to-GDP gap for the purposes of setting the buffer rate and to take different time horizons into account when doing so.

Eva Zamrazilová emphasised that in the case of non-financial corporations, the buffer rate covered the cyclical risks associated with debt to domestic banks. However, when assessing the financial cycle and taking a broader view of the risks, it was also necessary to consider total corporate indebtedness, which was significantly higher. She therefore recommended taking total corporate indebtedness into account in the decision-making process. She agreed with the Department’s conclusions that the economy and credit activity were recovering and that the economy was in a phase of the financial cycle in which the accumulation of cyclical risks might accelerate. She stated that the main growth factor was lending to households, particularly mortgage lending. In this context, she considered it crucial that the Department’s analyses indicated that even a marked decline in property prices would not threaten financial stability. She also stressed that she would pay attention to the link between the financial cycle and monetary policy. Growth in mortgage loans, property prices and, indirectly, rents was a key factor in this regard. High volumes of loans to households for consumption could also play an important role. She agreed with the Department’s recommendation to maintain the rate at 1.25% and said that if the financial cycle moved further upward, she would be open to discussing a rate increase at the next financial stability meeting.

Aleš Michl had no further comments on the proposal.

At the end of the meeting, the Board decided to maintain the CCyB rate for exposures located in the Czech Republic at 1.25%. All the board members present voted in favour of this decision.

Author of the minutes: Jiří Gregor, Financial Stability and Resolution Department