• Switzerland's news in English

Cheaper gold inflates Swiss central bank loss

Malcolm Curtis/The Local/AFP · 6 Jan 2014, 10:37

Published: 06 Jan 2014 10:37 GMT+01:00

Facebook Twitter Google+ reddit

The Swiss National Bank said in a news release that from provisional calculations it expects to lose 15 billion francs from its reserves of bullion, which has recently tumbled in price.

As a result of the anticipated loss, the SNB said it would not be able to pay its usual dividends to the cantons for the first time in more than a century.

The red ink compares with a profit of 6.9 billion francs in 2012 and 13.1 billion francs in 2011.

The loss in gold value in 2013 more than offset the 5.3 billion francs the central bank has in its distribution reserve fund, plus gains of around three billion francs each from currency transactions and the sale in November of its StabFund to UBS.

The stabilization fund was established in 2008 to take billions of francs of toxic assets off the books of Switzerland’s largest bank as part of a rescue package coordinated with the federal government.

The assets subsequently turned profitable and UBS, having recovered from the worst corporate loss in Swiss financial history, was able to buy them back from the SNB.

The central bank is also setting aside three billion francs for its currency reserve, leaving a 12-billion-franc hole overall in its accounts.

The upshot for the federal and cantonal governments is they will collectively lose a billion francs in revenue.

Under an agreement signed in 2011 between the BNS and the federal department of finance, the governments share this amount, provided that the central bank’s distribution fund is sufficient to offset losses.

Story continues below…

The annual profit distribution was previously 2.5 billion francs.

The SNB has been distributing a share of its profits to the Swiss cantons ever since its creation in 1907, and to the Swiss Confederation since1991.

The central bank is set to release detailed final figures for 2013 on March 7th, while its annual report will be published on March 25th.

Malcolm Curtis/The Local/AFP (news@thelocal.ch)

Facebook Twitter Google+ reddit

Your comments about this article

Today's headlines
Autumn in Switzerland: ten stunning Instagram photos
Photo: Swiss Tourism/Jan Geerk

Switzerland is beautiful in all seasons, but as these photos show, autumn is a special time in the alpine country.

Report: Swiss progress slows on gender equality
File photo: David Soulivet

Globally, it will take 170 years to achieve gender equality, according to the World Economic Forum.

Brothers go to court to stop suicide of sibling
File photo: Lisa Edmonds

Two men have filed a legal bid to prevent the Swiss assisted suicide association Exit from helping their older brother to kill himself.

Wawrinka snubs past form to reach Basel second round
Wawrinka beat local wildcard Marco Chiudinelli. Photo: Fabrice Coffrini/AFP

US Open champion Stan Wawrinka has reached the second round in Basel after going out in the first round for the past four years.

Villagers asked to help fund bridge renovations
The bridge links the two villages of Veltheim (pictured) and Holderbank. Photo: Lutz Fischer-Lamprecht

The crowdfunding campaign by the two communes is the first of its kind in Switzerland.

Police discover body buried in Orbe house
File photo: Bas Leenders

Police have opened an investigation after finding a body buried in a house in Orbe, in the canton of Vaud, on Saturday.

Valais shaken by 4.2 magnitude earthquake
The earthquake hit in the canton of Valais near Sierre. Photo: Alain Rouiller

It's the biggest earthquake to hit the country for two years.

Swiss Indoors kicks off without champ Federer
Federer celebrates with ball girls and boys after winning the event in 2015. Photo: Harold Cunningham/Pool/AFP

Stan Wawrinka is top seed as injured Federer sits it out.

IOC hires Russian doping whistleblower as consultant
IOC President Thomas Bach confirmed the news. File photo: Fabrice Coffrini/AFP

The International Olympic Committee (IOC) has hired Vitaly Stepanov as a consultant and is helping his runner wife Yuliya.

‘Scary clown’ craze hits streets of Zurich
Photo: Pedro Pardo/AFP

Police in Zurich have warned so-called ‘scary clowns’ that they could face charges, following a number of incidents in the city.

Photo: Unterirdisch Ueberleben
Inside Switzerland’s largest nuclear bunker – 40 years on
Sponsored Article
Last chance to vote absentee in the US elections
Photo: The Local
Ticino firefighters rescue cow from swimming pool
Photo: Antoni Da Campo
Vegan wins battle to be accepted by Swiss army
Photo: Swiss Tourism
Ten Swiss ski resorts named most expensive in Europe
Photo: Randy Kashka
Swiss women will ‘work for free’ for the rest of year
Photo: Swiss Tourism
Montreux throws hat in Olympic rings
Photo: Swiss Tourism
Seven things you’ll miss about Switzerland if you leave
Photo: Richard Juilliard/AFP
Man makes Geneva airport bomb threat ‘for a joke’
Photo: AFP
Solar Impulse team reveals plans for unmanned plane
File photo: Martin Abegglen
Swiss to vote on passport rules for 3rd gen foreigners
Photo: AFP
Swiss wingsuit hotspot Lauterbrunnen won’t impose ban
Photo: Swiss Tourism
Six reasons Switzerland isn’t as boring as you might think
Photo: Swiss Tourism
Report: Switzerland one of world’s best places for girls
Photo: The Local
Thief returns Swiss cow bells worth thousands
File photo: Wikimedia Commons
One in three rapists isn’t locked up: statistics
Photo: activistin.ch
Tampon-tax protest turns Zurich fountains red
Photo: AFP
Geneva police to lift ban on bearded officers
Photo: Marcel Gillieron/AFP
Suicide chef’s restaurant keeps Michelin stars
Photo: Lara de Salis
11 things the Swiss get tired of hearing abroad
Photo:  Ivo Scholz/Swiss-image.ch
Survey: expats in Switzerland have money but few friends
Photo: AFP
Swiss press criticize Bern’s 'capitulation' on immigration
Photo: Jura Trois Lacs tourism
German ex-policeman is Swiss city’s new hermit
Photo: Dmitry A. Mottl
Ticino votes to favour local workers over foreigners
jobs available