Bank interest margin (úroková marže)
The difference between the rate a bank charges the client and what it pays for money over the same period; for fixed-rate mortgages, that cost is roughly the swap rate of matching length. Out of the margin the bank covers default risk, operating costs, capital and profit. On variable-rate mortgages the margin is written into the contract as a mark-up over PRIBOR.
Example
A client is offered 5.00 % on a 5-year fixed period, while in September 2026 the 5-year swap is around 4.6 %. That leaves the bank a gross margin of about 0.4 pp, which on a CZK 4,000,000 loan is roughly CZK 16,000 of the approximately CZK 200,000 paid in interest in the first year.
In practice
The margin is the only part of the rate genuinely open to negotiation, since the market price of money is much the same for every bank. Your leverage is a low LTV, a high income, moving your current account or a competing offer. Pushing for a discount while swaps are rising tends to backfire: the bank would rather not hold the rate, and the offer lapses within a few weeks.
How it differs
Think of the interest rate as the full price of the loan and the margin as the slice above the cost of funding. A rate discount (bonifikace) trims the margin while you meet its conditions (account, insurance); breach them and the contractual margin returns.
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