March 23, 2023
Banking International

Swiss Central Bank Posts Biggest Loss In Its 116-Year History

The Swiss National Bank on Monday reported a loss of 132 billion Swiss francs ($143 billion) for the 2022 financial year, citing preliminary figures.

It represents the biggest loss in the central bank’s 116-year history and equates to roughly 18% of Switzerland’s projected gross domestic product of 744.5 billion Swiss francs. Its previous record loss was 23 billion francs in 2015.

As a result it will not make its usual payouts to the Swiss government and member states, it said, with payments to its shareholders also set to be affected. In 2021, the bank reported a 26 billion franc profit.

Of the losses, 131 billion francs came from its foreign currency positions and 1 billion from its Swiss franc positions amid strong gains made by the franc as investors flocked to the perceived safe haven amid European volatility.

Switzerland has historically attempted to rein in the stability of the franc because of its export-heavy economy, though critic have contended Swiss businesses have been competent to stick around competitive despite the growing franc due to euro area inflation.

Leave a Reply

Your email address will not be published. Required fields are marked *