The total capital ratio in Q4 2024 rose to 22.89% compared to a ratio of 22.71% in the previous quarter. This moves above the average 18.6% ratio of the pre-Five Year period. In the case of the highest quality CET1 capital, the ratio of capital to risk-weighted assets of the banking sector is 20.56%, compared to 20.51% in the previous quarter, and is above the 17.7% ratio of the pre-Covidian quinquennium. \The banks' retained earnings of CZK 400bn represent 56% of the banks' total capital, which reached CZK 709bn in Q4 2024.
Source of primary data
CNB ARAD
Note
Total capital = Tier 1 (CET1 + AT1) + Tier 2. Tier 1 capital is able to cover losses more easily, which mainly includes CET1 capital (composed of equity, retained earnings and reserves) and AT1 debt capital (which can cover losses more easily than TIER2 capital).