Commentary by the Czech Banking Association (ČBA)
The annual profitability of banks in the first quarter of 2026 reached 1.12% of the banking sector’s average assets and 17.1% of its Tier 1 capital.
Banks’ annual profitability, as measured by return on assets, remained essentially unchanged compared to the previous quarter (1.12% vs. 1.13%) and is below the 1.16% annual average achieved in the same period a year ago. Over the past five years, i.e., since the first quarter of 2022, profitability has reached 1.06% of assets. At the same time, profitability in terms of return on assets in the last quarter is below the pre-pandemic average of 1.16% from 2015–2019 (the long-term average from 2008–2019 was 1.24%).
In terms of banks’ profitability relative to Tier 1 capital, the return on capital fell to 17.1% from 18.8% in the previous quarter. The return on equity is below the 18.9% recorded in the same period a year ago. Over the past five years—that is, since the first quarter of 2022—profitability relative to Tier 1 capital has shown a return of 15.7%. Compared to previous trends, profitability relative to Tier 1 capital in the last quarter is below the pre-pandemic average of 17.4% (the long-term average from 2008–2019 was 20.5%).
Profitability of the banking sector
% of assets and capital
Source of primary data
CNB AradCategory
Banking sectorData frequency
quarterlyNote
In the case of return on equity, this is the ratio of year-to-date annualized after-tax profit to average year-to-date Tier 1 capital for the given period and since the end of last year.Return on assets is calculated as the annual average of quarterly after-tax profit divided by average annual assets.
The data also includes figures for banks and branches of foreign banks providing services in the Czech Republic, as well as figures for branches of banks operating abroad.