Czech National Bank: Domestic banks would withstand even a significant economic downturn

Domestic banks are in very strong financial condition and would be able to withstand even a significant deterioration in economic conditions. This was confirmed by the results of supervisory stress tests conducted by the Czech National Bank (CNB). According to the tests, the Czech banking sector has a robust capital buffer.

The supervisory stress test is based on the methodology of the European Banking Authority, adapted to the specific characteristics of the Czech banking sector. The baseline scenario is derived from the CNB's official macroeconomic forecast published in its Winter 2026 Monetary Policy Report, while the adverse scenario simulates a substantial worsening of economic conditions. This year's testing included 13 Czech banks, representing approximately 92% of the banking sector's total assets in the Czech Republic.