The Swiss central bank suffers a loss of 132 billion Swiss francs in 2022

The loss causes the withdrawal of payments to the Confederation and the cantons.

The Swiss central bank expects a record loss of 132 billion Swiss francs (133 billion euros) for 2022, against a profit of 26.9 billion francs a year earlier, it announced on Monday, this which leads it to cancel its payments to the Confederation and the cantons. With the shocks on the stock markets, the Swiss National Bank (SNB), which relies on a large investment portfolio, suffered a loss of 131 billion francs on its positions in foreign currencies, it indicates in a communicated.

Its positions in Swiss francs also fell into the red, suffering a loss of 1 billion francs. Its stock of gold, which remained unchanged, on the other hand generated a capital gain of approximately 400 million Swiss francs. After taking into account the reserve for future distributions of 102.5 billion, the loss on the balance sheet amounts to some 39 billion francs, details the SNB. These results are a first estimate, the final results being expected on March 6th. This heavy loss does not come as a surprise. For the sake of transparency, the SNB publishes quarterly details of the evolution of its monetary reserves. Over the year, it had seen its results fall with the tremors on the financial markets and last week the economists of the UBS bank had estimated that its annual loss could go up to 137 billion francs. However, this loss will have direct consequences for the finances of the cantons and the Confederation. “This loss makes any distribution for the 2022 financial year impossible.“, specifies the Swiss central bank in the press release.

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The SNB usually pays part of its profit to the cantons and the Confederation. Last year, it redistributed 6 billion Swiss francs to them. To carry out its monetary policy, the Swiss central bank relies on a vast portfolio of investments, which notably includes gold, stocks and bonds. For seven years, it conducted an ultra-accommodative monetary policy aimed at combating the overvaluation of the Swiss franc by means of a negative interest rate which it also supplemented by purchases of assets in foreign currencies. But with inflation, it changed course in 2022. It raised its interest rates and sold assets in foreign currencies.

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