Swiss National Bank expects profit of CHF49 billion for 2019

The SNB made a profit of around CHF40 billion from its foreign currency positions and a valuation gain of CHF6.9 billion on its gold holdings Keystone

The Swiss National Bank (SNB) expects to post an annual profit of CHF49 billion ($50.29 billion) for 2019, it said on Thursday, citing big gains from foreign bonds and stocks bought to dampen the value of the safe-haven Swiss franc. 

This content was published on January 9, 2020 minutes
Reuters/ts, with input from Armando Mombelli

The profit, following a loss of CHF15 billion in 2018, means the central bank will pay out CHF2 billion to the Swiss government and cantons for last year and will hold discussions with the finance ministry on a possible additional distribution for 2019 and 2020. 

The SNB made a profit of around CHF40 billion from its foreign currency positions and a valuation gain of CHF6.9 billion on its gold holdings, according to preliminary figures, it said in a statementExternal link.

It proposed an unchanged dividend of CHF15 per share and will publish its definitive figures on March 2. 

Spreading the wealth

The distribution of profits is regulated by a convention drawn up between the finance ministry and the SNB. For the period 2016-2020, the convention states, at least CHF1 billion must be paid to cantons and the government when reserves are positive.

When reserves go beyond CHF20 billion, meanwhile, this mandatory payout rises to CHF2 billion, as is the case for 2019. Extra payments – such as those being discussed at the moment – are partly influenced by growing pressure on the BNS to spread its wealth.

Indeed, also on Thursday, the annual conferenceExternal link of the Swiss Federation of Trade Unions called on the SNB to redistribute some of its surplus into the country’s ailing pension system. Jordan, however, said some weeks ago that he reckons it would be “dangerous to mix monetary policy and social policy”.

Profits have increased drastically since 2008, something also explained by the increased activity of the SNB in currency and international markets. At the same time, in the years when losses were recorded, these losses were also greater than before.

The only example in recent years when cantons received no payout at all was in 2013, when the SNB declared losses of CHF23.25 billion.


Making a profit is not part of the SNB’s mandate, which targets price stability while supporting the overall Swiss economy. 

As part of this goal the central bank has been waging a long campaign to reduce the value of the franc, which is sought by investors in times of geopolitical uncertainty but whose strength weighs on the export-reliant economy. 

The SNB’s profit reflects valuation gains, dividends and interest payments from the massive cache of stocks and shares it has bought to weaken the franc. 

At the end of 2019, the SNB had built up more than CHF804 billion in foreign currency investments, larger than the output of the entire economy.


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