Czech central bank keeps bank buffer rates, mortgage lending rules unchanged

Erste Bank AG

05/06/2025 14:30

PRAGUE, June 5 (Reuters) - The Czech central bank left countercyclical and systemic buffer rates for banks unchanged on Thursday and maintained its current mortgage lending rules, it said after a financial stability meeting.

The central bank said the Czech financial sector was stable and resilient to potential adverse impacts.

It left its countercyclical capital buffer rate at 1.25%, saying it was sufficient to cover an expected slight increase to the level of cyclical risks in the sector's balance sheet in its outlook horizon.

"Potential adverse developments in the global economy and uncertainties in international trade may increase some structural risks in the Czech economy, so the banking sector's resilience should continue to be strengthened using the systemic risk buffer," bank board member Jakub Seidler said.

The systemic risk buffer has been applied at 0.5% since January 1.

On the housing market, the bank said transaction activity in the mortgage market was returning to its long-term average and residential property price growth had picked up considerably.

The bank said it decided to keep the loan-to-value (LTV) limit at 80% in its mortgage lending rules.

 (Reporting by Jason Hovet and Jan Lopatka)

 ((jason.hovet@thomsonreuters.com;))