Swiss central bank posts record profit

GMT 16:17 2015 Friday ,09 January

Arab Today, arab today Swiss central bank posts record profit

Swiss National Bank (SNB)
Vienna - SPA

Switzerland's central bank reported Friday a record net profit of 38 billion Swiss francs (37.3 billion dollars) in 2014, owing to gains in its sizeable foreign currency holdings, according to dpa.
In 2013, the Zurich-based Swiss National Bank (SNB) had posted a net loss of 9 billion francs because the value of its gold reserves had dropped sharply. Last year, by contrast, the SNB's gold holdings gained 4 billion francs in value.
However, foreign currency assets played an even bigger role in the bank's turnaround, as positive exchange rate effects contributed 12 billion francs to the overall profit.
The central bank had increased its foreign currency reserves to 495 billion francs by the end of December, as part of its strategy to prevent the Swiss currency from strengthening even further.
The huge foreign currency holdings have enabled the central bank to reap gains based on exchange rates, but these windfalls could also quickly turn into losses if currency markets change course, SNB spokesman Werner Abegg said.
'The risks have increased sharply,' he told dpa.
The plummeting rouble and worries over Greece's future economic course have been pushing investors toward safe assets, such as the Swiss franc and German government bonds.
There are concerns that the resulting stronger franc could hurt Switzerland's exporting industry and the economy as a whole.

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