Prague’s financial reputation received another vote of confidence this week as Moody’s Investors Service maintained the city’s high-grade credit assessment at Aa3, accompanied by a stable outlook. The confirmation keeps the Czech capital aligned with the sovereign rating, underscoring both its fiscal discipline and the expectation of national backing in times of stress.

According to council documents released on Monday, Moody’s praised Prague’s ability to consistently generate sizeable operating surpluses, which provide the main source of funding for major infrastructure projects. Analysts also pointed to the city’s ample reserves and exceptionally light debt burden, which together give it room to withstand economic shocks.

The agency nevertheless noted several structural challenges. Prague’s revenues are closely tied to the performance of the national economy, leaving it less flexible than some peers in how it raises income. At the same time, rapid growth and the demands of modernization continue to impose heavy spending obligations. For the city’s rating to rise further, an improvement in the Czech Republic’s own standing would be necessary.

The confirmation places Prague in the same rating category as Paris, while other regional capitals remain lower on the scale. Warsaw, for example, is aligned with Poland’s sovereign A2 rating, and Budapest continues to sit near the bottom of the investment-grade spectrum.

The number of people seeking court protection from debts in the Czech Republic has risen sharply this year. From January through August, courts declared more than 10,800 personal bankruptcies, roughly 14 percent higher than in the same period of 2024. Petitions for insolvency also increased, with over 11,000 accepted in the first eight months, a jump of about 12 percent year-on-year.

Analysts note that this is the steepest rise in personal insolvencies recorded in an eight-month span since 2021, reversing the temporary decline seen between 2020 and 2023. The trend has been linked to weaker payment discipline, reflected in the growing share of non-performing consumer loans. At the same time, household savings are expanding more slowly, while demand for short-term credit has grown close to ten percent this year.

Regional figures show that the largest numbers of bankruptcies were declared in the Moravian-Silesian Region, the Ústí Region, and Central Bohemia. The lowest counts were registered in Zlín, Vysočina, and Karlovy Vary. In Prague, the year-on-year increase was especially steep, with the capital recording about a third more cases than a year earlier.

Looking at bankruptcies relative to population, the Ústí Region remains the most affected, with more than 40 cases per ten thousand residents over the past 12 months. By contrast, Pilsen has seen only about six per ten thousand inhabitants, the lowest rate in the country.

Altogether, Czech courts have declared more than 15,000 personal bankruptcies in the past 12 months, an 11 percent rise from the previous year. With consumer borrowing still climbing and wages rising at a brisk pace, experts caution that the upward momentum is likely to continue in the coming months.