Banking amendment: wider powers for CNB and clarification of rules for branches of banks from third countries
The amendment to the Banking Act and other financial market laws is already valid, and most of its provisions will enter into effect from 11 January 2026. The amendment transposes the Capital Requirements Directive VI (CRD VI), regulates certain issues in relation to the Capital Requirements Regulation III (CRR III), and contains provisions concerning the previous implementation of the CRD V following its application in practice.
Stronger powers to Czech National Bank
The CNB will seek earlier and more detailed information on transactions that may increase risks for banks and financial holding companies. This concerns transfers of large blocks of assets or liabilities, purchases and sales of significant stakes, and mergers and demergers. The bank will be required to submit in advance information on the reasons for the transaction, its impact on capital and liquidity, changes in risk management and staffing to the CNB, which then may refuse a transaction if it could undermine stability or raises AML suspicions. The amendment also clarifies sanctions and provides for an enforcement penalty the CNB may use to seek redress.
Branches of non-EU banks
To achieve greater uniformity of approach across the EU, the amendment introduces more detailed rules for branches of foreign banks from non-EU countries. The Banking Act and related legislation will include a more detailed list of documents required to obtain a permit from the CNB, a more uniform regulation of obligations, and rules for greater cooperation with other European supervisors.
Existing branches must adjust their processes, risk management, and governance and adapt to the new reporting obligations by 11 January 2027 to actively demonstrate to the CNB that they meet the new licensing conditions. The CNB may request from the branches a time plan of their adaptation to the new legislation and progress reports on its implementation.
Changes in governance, management, and approaches to ESG risks
The amendment strengthens the requirements for integrity and professional competence of the management of the bank or branch. Banks will also have to place even greater emphasis on environmental, social and governance risks: they will have to identify, assess and manage them more thoroughly, in a similar way to other prudential risks. This will require updating internal guidelines and policies.
The CNB will assess the suitability of persons proposed for appointment as members of the statutory body or supervisory board before their appointment.
How we can help you
At your request, we will perform a gap analysis to assess whether you meet the requirements of the amended legislation, propose implementation measures, and help you implement them into your internal processes and internal regulations.