Central European Banks Project Sustained 2026 Profits
The regional banking sector expects to maintain record profit levels despite rising windfall taxes across several countries.
Updated on Oct. 21, 2026 in Financial Services
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Raiffeisen Research projects that the Central and Southeast European banking sector will sustain annual profits near €31.5 billion in 2026. This outlook follows a record-setting 2025 performance for the region's financial institutions.
Why it matters
Higher interest rates and regional economic shifts have supported bank margins, even as windfall taxes in countries like Hungary, Romania, and Slovakia are set to climb to €1.8 billion by 2026. The sector maintains a higher return on equity than the broader euro area average, reflecting resilient balance sheets despite various geopolitical and energy pressures.
Regional banks achieved a return on equity between 15% and 16% through the first half of 2026, significantly outperforming the 9% average seen in the euro area. Meanwhile, K&H Bank reported an 80% profit decline in the first half of 2026.
The players
Raiffeisen Research
This analytical unit provides economic and financial insights as part of the broader Raiffeisen Bank International group.
Erste Group
Headquartered in Vienna, this financial services provider is one of the largest banking groups in Central and Eastern Europe.
K&H Bank
This commercial bank provides a full range of financial services to individual and corporate clients in Hungary.
The details
Industry consolidation remains a defining feature of the market, highlighted by acquisitions such as the purchase of Santander Bank Polska by Erste Group. Retail lending growth is expected to rise by 10% to 12% annually as EU funds and fiscal stimulus drive supply chain activity into the region.
Timeline
Regional windfall taxes totaled €1 billion during 2024.
The regional banking sector reached a record €31.5 billion in profit during 2025.
Return on equity held at 15-16% through the first half of 2026.
Regional windfall taxes are projected to rise to €1.8 billion in 2026.
The regional profit pool is projected to reach €37-38 billion by 2030.
Market Landscape
The banking sector is currently leveraging regional growth driven by the European Union's regional fiscal stimulus programs to consolidate market share. This expansion offsets increased regulatory burdens in specific markets and positions regional players against the broader euro area average.
Increased windfall taxes and regional bank profit pressures may influence the availability and cost of retail lending products for local consumers. Customers should monitor potential shifts in service fees or product offerings as banks navigate these fluctuating tax environments.
The takeaway
Regional banks are currently showing significant resilience and profit margins that exceed those found in the broader eurozone. Investors and clients should watch how banks manage the dual pressures of high profitability and increasing government levies.
Further reading
For broader context on current industry performance, view the latest updates on Financial Services.
Source note: This article includes information reported by Intellinews.
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