Banking sector profit trends in Central Europe

In the first half of 2026, the banking sectors in the Czech Republic and Croatia experienced declines in profitability.

J&T Banka reported a consolidated net profit of 3.6 billion CZK, an 11.4 percent decrease from the previous year. Financial Director Michal Kubeš attributed this decline to higher operating costs related to the development of information systems and technologies. However, the bank saw assets under management grow by 26.6 percent compared to the end of 2025.

On a broader scale, the Croatian National Bank reported that total profits for Croatian credit institutions fell by 5.5 percent to 751.7 million euros. While major institutions like Zagrebačka banka remained profitable, J&T banka and others recorded losses during this period. Despite the drop in earnings, the Croatian banking sector maintained high capitalization levels and met liquidity coverage requirements.

Recent economic indicators for Southeast Europe show broader shifts in stability. While the Croatian banking system remains highly capitalized, the country recorded the third-highest growth in business bankruptcies in the EU during the second quarter.

Regional data from the EBRD indicates that the non-performing loan (NPL) ratio in Central, Eastern, and Southeastern Europe reached a historic low of 1.86 percent at the end of 2025, even as the total nominal amount of problematic loans increased. In Bosnia and Herzegovina, banks anticipate a slight increase in consumer and non-purpose credit demand for the third quarter, though credit standards for companies may tighten. Meanwhile, North Macedonia reported an average interest rate on total loans of 4.68 percent in July.