Central bank: banking sector is healthy and resilient

The Czech National Bank itself has released the results of tests it carried out that suggest that the Czech banking sector is healthy and resilient against risk. According to the resulting report, the stability of the country’s banking sector should not be jeopardized even by substantially negative economic developments. In the event of such negative developments, certain institutions would suffer losses that could require injections of capital from shareholders. The central bank tested the resilience of the financial sector using three alternative scenarios of future development. The greatest impact on the financial system would be caused by a loss of confidence that would lead to losses of roughly two percent of the entire financial sector – an amount that would require a relatively small injection of 5 billion crowns.