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Interim results of the Swiss National Bank as at 30 June 2016

 

Interim results of the Swiss National Bank

The Swiss National Bank (SNB) reports a profit of CHF 21.3 billion for the first half of 2016.
A valuation gain of CHF 7.6 billion was recorded on gold holdings. The profit on foreign currency positions amounted to CHF 13.0 billion.
The SNB’s financial result depends largely on developments in the gold, foreign exchange and capital markets. Strong fluctuations are therefore to be expected, and only provisional conclusions are possible as regards the annual result.

Income statement, 1 January–30 June 2016

Income statement, 1 January–30 June 2016

- Click to enlarge

Profit on foreign currency positions

The net result on foreign currency positions amounted to CHF 13.0 billion.
Interest income accounted for CHF 4.1 billion and dividends for CHF 1.7 billion. Movements in bond prices differed from those in share prices. The generally lower interest rate level resulted in price gains of CHF 10.3 billion on interest-bearing paper and instruments. By contrast, a loss of CHF 0.2 billion was recorded on equity securities and instruments. Overall, exchange rate-related losses amounted to CHF 2.9 billion.
SNB results Q2 2016  (in billion CHF) Profit BalanceSheet Profit in %
Total Profit on foreign currencies 13 689 1.89%
Interest income 4.1 689 0.60%
Dividend income 1.7 689 0.25%
Price changes in Bonds 10.3 689 1.49%
Price changes in Equities -0.2 689 -0.03%
Exchange Rate Losses -2.9 689 -0.42%

Income statement for the second quarter of 2016

Income statement for the second quarter of 2016

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Valuation gain on gold holdings

A valuation gain of CHF 7.6 billion was achieved on gold holdings, which in volume terms have remained unchanged. Gold was trading at CHF 41,408 per kilogram at end-June 2016 (end-2015: CHF 34,103).
SNB Results Q2/2016
(in bn CHF)
Profit Balance Sheet Profit in %
Total Profit on Gold 7.6 689 1.10%

Percentage of gold to balance sheet

SNB Balance Sheet items
(in bn CHF)
2016 2015
Gold 43.1 35.5
Total Balance Sheet 689 640
Gold in % of Balance Sheet 6.26% 5.55%

Balance Sheet

The balance sheet has expanded by over 49.4 bn. francs by 7.66%.

2016 2015 Increase in %
SNB balance sheet in CHF 689 640.00 7.66%
Swiss GDP in CHF 650 645.00 0.78%
% of GDP 106.00% 99.22%

Balance sheet as at 30 June 2016

Balance sheet as at 30 June 2016

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While the SNB supports foreign stock markets and foreign companies, it does not invest in Swiss stocks.

H1 2016 2015
Swiss Franc Securities 176.9 42.7
Total Balance Sheet 689594 640151
%CHF securities 0.0257% 0.0067%

Profit on Swiss franc positions

The SNB maintains its profitability, last but not least, thanks to the reduction of the profitability of banks. When too many funds arrive on their accounts, they must deposit them on their sight deposit account at the SNB.

The profit on Swiss franc positions, which totalled CHF 868 million, essentially comprised CHF 692 million of negative interest charged on sight deposit account balances since 22 January 2015, price gains of CHF 150 million and interest income of CHF 31 million on Swiss franc securities.

Negative Interest rates

Furthermore, the SNB harms the Swiss economy, when it reduces the profits of Swiss banks by negative interest rates. But with this measure she maintains her own profitability.

2016 2015 Change in %
Income through negative interest rates 0.69 0.53 30.19%
SNB balance sheet 689 640
in % of balance sheet 0.10% 0.08%

SNB Result for Swiss Franc Positions, H1 2016

SNB Result for Swiss Franc Positions, H1 2016

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SNB Liabilities

Electronic Money Printing: Sight Deposits

Sight deposits is the biggest part of SNB interventions.

Paper Printing

2016 2015 Change in%
Total Sight Deposits 511.2 468.9 9.02%
Balance Sheet 689 640 7.66%
% of balance sheet 74.19% 73.27%

Banknotes in circulation: -1.07 bn francs to 72 bn. CHF


The old form of a printing press, today a less important form of central bank interventions.

Provisions for currency reserves

As at end-June 2016, the SNB recorded a profit of CHF 21.3 billion, before the allocation to the provisions for currency reserves.
In accordance with art. 30 para. 1 of the National Bank Act (NBA), the SNB is required to set aside provisions permitting it to maintain the currency reserves at the level necessary for monetary policy. The allocation for 2016 will be determined at the end of the year.
Liabilities

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Appendix

Accounting and valuation principles

The SNB is a special-statute joint-stock company with head offices in Berne and Zurich. These interim results have been drawn up in accordance with the provisions of the NBA and the Swiss Code of Obligations (CO) as well as the accounting principles detailed in the notes to the annual financial statements as at 31 December 2015. These results present a true and fair view of the financial position and the results of operations of the SNB. Unless otherwise stated, the accounting principles are based on the Swiss GAAP FER standards (Accounting and Reporting Recommendations). Departures from Swiss GAAP FER occur only if an accounting principle runs counter to the provisions of the NBA or if the special nature of the SNB needs to be taken into account. In a departure from Swiss GAAP FER, no cash flow statement has been prepared. The structure and designation of the items in the balance sheet and the income statement take into consideration the special character of the business conducted at a central bank.
Compared with the annual financial statements as at 31 December 2015, there were no changes to the accounting and valuation principles.
The SNB interim results as at 30 June 2016 constitute an interim report in accordance with Swiss GAAP FER 31, with condensations in presentation and disclosures.
Swiss GAAP FER 31 requires the presentation of earnings per share. This has no informative value in view of the special statutory provisions for the SNB. Shareholders’ rights are determined by the NBA and their dividends, in particular, may not exceed 6% of share capital (with a nominal value of CHF 250 per share, a maximum of CHF 15); the Confederation is entitled to one-third and the cantons to two-thirds of the remaining distributable profit. Therefore, no presentation of earnings per share is made.

Net result from foreign currency positions

Net result from foreign currency positions

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About SNB
SNB
The Swiss National Bank conducts the country’s monetary policy as an independent central bank. It is obliged by the Constitution and by statute to act in accordance with the interests of the country as a whole. Its primary goal is to ensure price stability, while taking due account of economic developments. In so doing, it creates an appropriate environment for economic growth.
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