Moody's: Czech banks benefit

Moody's Investors Service said that the overall outlook for rated Czech banks remains stable as they continue to benefit from parental and systemic support expectations, as well as sound risk profiles underpinned by retail strategies, improved risk management and moderate risk appetite.

The agency added that the Czech banking sector is also underpinned by strong economic growth and mounting appetite for consumption and borrowings.

"In Moody's view, Ceskoslovenska Obchodni Banka, Ceska Sporitelna, Komercni Banka and Zivnostenska Banka would receive financial support from their foreign strategic shareholders as well as support from the Czech authorities in the case of need, whilst the Czech Export Bank benefits from 100% state ownership - thus underpinning their deposit ratings," said Yaroslav Sovgyra, a Moody's vice-president/senior analyst and co-author of the report.

The three large banks - Ceskoslovenska Obchodni Banka, Ceska Sporitelna and Komercni Banka - control 60% of the total banking assets and have a combined market share of 60-70% in most sectors, Moody's said.

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