Overview
The SNB earned 2 billion on negative interest rates, but lost nearly 17 billion CHF on FX investments, of which 5 bn on bonds and 12 bn on stocks.
The increasing volatility of SNB EarningsAnnual results are not really definite. Given that the SNB accumulates foreign currencies with interventions, the results have huge swings that depends on the FX rate. But the SNB may lose 50 billion in one year and win 60 billion in the next year or vice verse. Franc will rise again with crisis or inflationWith a new financial crisis or a with a big rise of inflation, the run into the Swiss franc will start again. And this at an exchange rate that is not digestible for the SNB.
And this will lead to a massive SNB loss around 150 billion CHF. |
Some extracts from the official statement.
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Income Statement for 2018![]() Source: snb.ch - Click to enlarge |
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Loss on foreign currency positions
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SNB Profit on Foreign Currencies for 2018![]() Source: snb.ch - Click to enlarge |
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Valuation loss on gold holdings
Percentage of gold to balance sheetThe percentage of gold compared to the total balance sheet is falling.
Balance Sheet For the first time in years the balance sheet has contracted: by 3%.
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SNB Balance Sheet for Gold Holdings for 2018![]() Source: snb.ch - Click to enlarge |
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Profit on Swiss franc positionsThe 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.
Negative Interest ratesFurthermore, 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.
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SNB Result for Swiss Franc Positions for 2018![]() Source: snb.ch - Click to enlarge |
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SNB LiabilitiesElectronic Money Printing: Sight Deposits Sight deposits is the biggest part of SNB interventions.
Paper Printing Banknotes in circulation: -2.6 bn francs to 79 bn. CHF
Provisions for currency reserves
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SNB Liabilities and Sight Deposits for 2018![]() Source: snb.ch - Click to enlarge |
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Tags: newsletter,SNB balance sheet,SNB equity holdings,SNB Gold Holdings,SNB profit,SNB results,SNB sight deposits,Swiss National Bank