The Swiss National Bank’s forays into the foreign exchange markets have – along with the appreciation of the franc – led to spectacular losses, which in turn have provoked the ire of some of the country’s politicians.
One of the reasons why is that the central bank has traditionally paid out Sfr2.5bn each year to the Swiss confederation and the country’s cantons, which own the majority of the SNB.
The losses have thrown that into doubt. With the central bank announcing a paper loss of Sfr10.8bn for the first half of 2011, will it pay out? The message from Thomas Jordan, the SNB’s vice chair, today: don’t count on it. Read more