Featured Product

    IMF Reports on 2017 Article IV Consultation with Czech Republic

    June 26, 2017

    IMF published its staff report and selected issues report in the context of the 2017 Article IV consultation with Czech Republic. The staff report highlights that a number of macro- and micro-prudential measures had been taken, including tighter capital requirements, off- and onsite supervision, loan-to-value (LTV) recommendations, and the consumer credit act. The selected issues report examines the impact of removing the exchange rate floor on the monetary policy.

    The staff report reveals that the banking system is liquid and profitable. aggregate capital ratios are above requirements. Leverage is low and liquidity high. Banks are funded mainly from deposits. Moreover, aggregate levels of non-performing loans are low and decreasing as nominal demand picks up, while provisioning is in line with that of peers. The authorities broadly shared staff’s assessment of risks and the need for additional macro-prudential measures. The Czech National Bank has implemented a number of prudential measures to manage financial risks. Capital requirements on banks are relatively high, the capital conservation buffer has been fully implemented, and the counter cyclical capital buffer has been set to 0.5% of the risk-weighted exposure amounts (from 2017). Buffers have been activated for five systemically important banks. The authorities are moving toward implementation of the Bank Recovery and Resolution Directive (BRRD). The framework is intended to facilitate orderly resolutions of financial institution while cushioning tax payers from losses. The BRRD was transposed into Czech law in 2016; as the designated resolution authority, the CNB is working to develop resolution plans and calibrate appropriate levels of eligible liabilities for each institution (MREL). An important input to this work will be the decision at the European level about MREL targets. Given that the banking system is dominated by subsidiaries of parents from the euro area, a key issue in the development of resolution plans yet to be agreed by the Single Resolution Board and national authorities is the choice between single or multiple points of entry when resolving banks.

     

    Related Links

    Staff Report (PDF)

    Selected Issues Report (PDF)

    Keywords: Europe, Czech Republic, IMF, Article IV, Basel III, Banking, BRRD


    Featured Experts
    Related Articles
    News

    APRA Consults to Standardize Submission Date for Quarterly Reporting

    APRA proposed to standardize quarterly reporting due dates for authorized deposit-taking institutions. The proposed standardized due date is 35 calendar days after the last day of the reference quarter, which will create a 14-calendar-day extension for credit unions and building societies.

    November 08, 2019 WebPage Regulatory News
    News

    EBA Single Rulebook Q&A: First Update for November 2019

    EBA updated the Single Rulebook question and answer (Q&A) tool with answers to two questions. The answers provide clarifications on topics related to own funds and strong customer authentication under the revised Payment Services Directive or PSD2.

    November 08, 2019 WebPage Regulatory News
    News

    FED Proposes to Extend Initial Compliance Dates Under SCCL Rule

    FED published a proposal to extend, by 18 months, the initial compliance dates for foreign banks subject to the single-counterparty credit limit (SCCL) rule.

    November 08, 2019 WebPage Regulatory News
    News

    EBA Publishes Technical Package on Reporting Framework 2.9.1

    EBA published a new release of the reporting framework 2.9.1. This release includes validation rules, Data Point Model (DPM) data dictionary, XBRL taxonomy, and other supporting documents. Additionally, the release fixes some modeling issues on COREP Liquidity and FINREP.

    November 08, 2019 WebPage Regulatory News
    News

    EBA Publishes Methodology and Draft Templates for Stress Tests in 2020

    EBA published a package for the 2020 EU-wide stress test exercise for banks.

    November 07, 2019 WebPage Regulatory News
    News

    EC Publishes Results of Fitness Check of Reporting Requirements in EU

    EC published results of the fitness check of supervisory reporting requirements in financial services legislation in EU.

    November 07, 2019 WebPage Regulatory News
    News

    BCBS Assesses NSFR and LE Rules in Argentina and China as Compliant

    BCBS published reports that assess the implementation of net stable funding ratio (NSFR) and large exposures, or LE, framework in Argentina and China.

    November 07, 2019 WebPage Regulatory News
    News

    FSB Publishes Summary of Plenary Meeting in Paris

    At the meeting, the Plenary reviewed vulnerabilities in the global financial system, fintech developments (including developments in the crypto-asset markets), ongoing work of FSB, and the work program for 2020.

    November 07, 2019 WebPage Regulatory News
    News

    HKMA Highlights Technology Initiatives at the Hong Kong FinTech Week

    HKMA co-organized, with InvestHK, the Hong Kong FinTech Week 2019, which was a five-day flagship fintech event that attracted thousands of attendees worldwide.

    November 06, 2019 WebPage Regulatory News
    News

    ECB Report on Fallback Provisions in Contracts Referencing EURIBOR

    ECB published a report, by private sector working group on euro risk-free rates, presenting recommendations for fallback provisions in contracts for cash products and derivative transactions referencing EURIBOR.

    November 06, 2019 WebPage Regulatory News
    RESULTS 1 - 10 OF 4118