Financial Regulatory Forum

Czech central bank sees banks withstanding shocks

By John Manley
February 23, 2010
Banks | central bank | czech | stress tests

    PRAGUE, Feb 23 (Reuters) – The Czech banking system will maintain sufficient capital adequacy in all projected scenarios of economic and market development, central bank stress tests showed on Tuesday.
   Risks to the overall financial stability will remain high but the banking sector was seen to be able to resist all potential unfavourable shocks.
   Aggregate capital adequacy will remain above the regulatory 8 percent minimum in all three projected scenarios, although several banks may face the need to slightly raise capital in two out of three scenarios. 
   The most pessimistic scenario however saw the need to hike capital in the banking system by just 13 billion crowns ($691.5 million).
   The baseline scenario is based on the bank’s staff forecast, assuming GDP growing by 1.4 pct.
 (Reporting by Jana Mlcochova and Jan Lopatka)
 ((prague.newsroom@thomsonreuters.com; Reuters Messaging: jana.mlcochova.reuters.com@reuters.net; +420-224 190 479)) ($1=18.80 Czech Crown)
 Keywords: CZECH BANKS/STRESS TESTS 
  
Tuesday, 23 February 2010 10:00:01RTRS [nPRC003356] {C}ENDS

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