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Interim results of the Swiss National Bank as at 30 September 2021



The increasing volatility of SNB Earnings

Annual results are not really definite. Given that the SNB accumulates foreign currencies with interventions, they have huge swings.

But the SNB may lose 50 billion in one year and win 60 billion in the next year or vice verse.

Low Inflation, Crashes and Central Bank Money Printing

The crisis caused by the Covid19 virus,is a typical crisis with low inflation (at least for now). During such a crisis, central bank money printing helps asset price to rise again.

This applies to all assets on the SNB balance sheet:

  • Government and corporate bonds
  • Stocks
  • Gold

The Corona crisis is just one of these low inflation crisis.

Therefore SNB profits have recovered; this time far more quickly than during the Financial Crisis. As opposed to 2009 until early 2011, the Swiss Franc is currently not overvalued.

Therefore the SNB did not let the Swiss franc appreciate. Without an a franc appreciation, however, the SNB must make profits during a period of central bank money printing.

But a prolonged crisis, will again put pressure on SNB to let the franc appreciate.

Franc will rise again with inflation

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.
We considered that after an inflationary period the

  • EUR/CHF will fall to 0.90
  • and USD/CHF to 0.75.

And this will lead to a massive SNB loss around 150 billion CHF.

However, we are not there yet: Inflation is low and interest rates even lower.

Some extracts from the official statement.


The Swiss National Bank reports a profit of CHF 41.4 billion for the first three quarters of 2021.

The profit on foreign currency positions amounted to CHF 42.2 billion. A valuation loss of CHF 1.3 billion was recorded on gold holdings. The profit on Swiss franc positions amountedto CHF 0.8 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 September 2021

Income statement, 1 January–30 September 2021

Source: - Click to enlarge

Profit on foreign currency position

The profit on foreign currency positions totalled CHF 42.2 billion.

Interest and dividend income amounted to CHF 5.5 billion and CHF 2.9 billion respectively. While price losses of CHF 13.7 billion were recorded on interest-bearing paper and instruments, equity securities and instruments registered price gains of CHF 22.2 billion. Exchange rate-related gains totalled CHF 25.3 billion.

The following numbers are in billion Swiss Francs.


SNB results Q1-Q3 2021
(in bn CHF)
Profit Balance Sheet Profit in %
Total Profit on foreign currencies 42.2 1050 4.02%
Interest income (coupons) 5.5 1050 0.52%
Dividend income 2.9 1050 0.28%
Price changes in bonds -13.7 1050 -1.30%
Price changes in equities 22.2 1050 2.11%
Exchange Rate Gains 25.3 1050 2.41%

SNB Profit on Foreign Currencies

SNB Profit on Foreign Currencies

Source: - Click to enlarge

Valuation gain on gold holdings

A valuation loss of CHF 1.3 billion was recorded on gold holdings, which remained unchanged in volume terms. Gold was trading at CHF 52,373 per kilogram at the end of September 2021 (end-2020: CHF 53,603).


SNB Results Q1-Q3 2021
(in bn CHF)
Profit Balance Sheet Profit in %
Total Profit on Gold………………………….. -1.3 1050 -0.12%

Percentage of gold to balance sheet

The percentage of gold has fallen to 5.19% thanks to higher prices.


SNB Balance Sheet items
(in bn CHF)
Q3 2021
2018 2017 2016 2015
Gold…………… 54.5 55.7 49.1 42.2 42.5 39.4 35.5
Total Balance Sheet 1050 999 860.9 812.8 843.3 746 640
Gold in % of Balance Sheet 5.19% 5.58% 5.70% 5.20% 5.04% 5.28% 5.55%


Balance Sheet

The balance sheet has expanded by 138.1 bn. francs, this is 16.04%.

(in bn CHF) Q3 2021
Increase in %
SNB balance sheet in CHF………………. 1050 999 5.11%
Swiss nominal GDP in CHF 670 (est.) 706.14 0.00%
% of GDP 141.47%

SNB Balance Sheet for Gold Holdings for Q3 2021

SNB Balance Sheet for Gold Holdings for Q3 2021

Source: - Click to enlarge

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 totalled CHF 0.8 billion. It largely resulted from negative interest charged on sight deposit account balances.

Profit on Negative Interest rates

Furthermore, the SNB harms the Swiss economy, when it reduces the profits of Swiss banks by negative interest rates, currently -0.75%. But with this measure she maintains her own profitability.

The SNB obtained far less money for negative rates, while sight deposits were slightly up (see below). The reason is this time the Corona crisis and that banks lend more money and did not put on the accounts of the central bank.

Still, as compared to the FX profits or gains on equities and bonds above, this number is relatively low.

(in million CHF) Q3 2021 2020
Change in %
Income through negative interest rates 968 1017.3 -4.85%
SNB balance sheet 1050.0 999.0
in % of balance sheet 92.19% 101.83%

SNB Result for Swiss Franc Positions for Q3 2021

SNB Result for Swiss Franc Positions for Q3 2021

Source: - Click to enlarge

SNB Liabilities

Electronic Money Printing: Sight Deposits

Sight deposits is the biggest part of SNB interventions.

Sight deposits increased more strongly (19%) than the total balance sheet. The increase was on domestic banks.


(in bn CHF) Q3 2021 2020
Change in%
Total Sight Deposits 714.9 702.9 +1.71%
Balance Sheet 1050 999.0 +5.11%
Sight Deposits % of balance sheet 68.09% 70.36%
Paper Printing

Banknotes in circulation: -0.98 bn francs to 88.0 bn. CHF.

This old form of a printing press, today a less important form of central bank interventions. It showed that safe-haven Swiss francs, e.g. 1000 franc bank notes are currently less in demand than previously.

Provisions for currency reserves

As at end-September 2021, the SNB recorded a profit of CHF 41.4 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 the current financial year is determined at the end of the year.

SNB Liabilities and Sight Deposits for Q3 2021

SNB Liabilities and Sight Deposits for Q3 2021

Source: - Click to enlarge

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George Dorgan
George Dorgan (penname) predicted the end of the EUR/CHF peg at the CFA Society and at many occasions on and on this blog. Several Swiss and international financial advisors support the site. These firms aim to deliver independent advice from the often misleading mainstream of banks and asset managers. George is FinTech entrepreneur, financial author and alternative economist. He speak seven languages fluently.
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