The global financial crisis, which has been crushing banks all over the world, has directly hit a Czech bank for the first time. The Belgian KBC, ČSOB’s parent company, announced Wednesday it is expecting nearly EUR 1 billion losses in the third quarter of this year. The reason for the losses is the overvaluation of securities that the company, including ČSOB, bought. The investment problems will quickly lower ČSOB’s expected profit by CZK 6.2 billion. Spokesman Ivo Měšťánek said if it weren’t for the investement problems, the bank’s revenues would have totalled CZK 8.9 billion in the first three quarters. Now it will be only CZK 2.7 billion. He said the overvaluation of securities will not have any impact on
The Finance Ministry does not plan to issue any state bonds in the coming weeks except for an eight-year floating rate note due to be auctioned on 22 October, Deputy Minister Eduard Janota said on Wednesday.
The Czech central bank (CNB) said on Tuesday it will start repo operations on Wednesday to supply liquidity and allow domestic government bonds to be used as collateral.
The Czech government approved an amendment to the country’s bank law Tuesday to double the guarantee for bank deposits. The bill, which still needs to be approved by Parliament, proposes that bank deposits in the Czech Republic be fully guaranteed up to EUR 50,000, Finance Minister Miroslav Kalousek said. Now the Czech Republic guarantees deposits up to EUR 25,000.