After a record loss of CHF 132 billion, the Swiss National Bank (SVB) will not distribute any money to the public sector for 2022.

In the previous year, the SNB had distributed the maximum possible sum of six billion francs.

Two thirds of this went to the cantons and one third to the federal government.

John Knight

Correspondent for politics and economy in Switzerland.

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A year ago, the central bank was still able to draw on plenty, having closed 2021 with a profit of CHF 26.3 billion.

On this basis, the private shareholders of the SNB were also served with the maximum dividend of CHF 15 per share.

This distribution is now also falling flat, as the National Bank announced on Monday in a first brief review of the past year.

Up again in the fourth quarter

The SNB is one of the handful of central banks whose shares are listed on the stock exchange.

However, the rights of private shareholders are severely restricted under the National Bank Act.

The largest private shareholder is the Düsseldorf entrepreneur Theo Siegert with a stake of 5 percent.

He has no influence: each private shareholder has a maximum of 100 votes.

The massive loss comes as no surprise.

After the first nine months, at CHF 142.4 billion, this was even higher than for the year as a whole.

That also means that the SNB made a profit of a good CHF 10 billion in the fourth quarter.

Large fluctuations in earnings are typical given the huge balance sheet that the National Bank has built up in recent years.

In her fight against an excessive appreciation of the franc, she accumulated a huge stock of foreign exchange.

The money is invested in bonds, stocks and gold, among other things.

If the value of these investments changes, the result of the SNB also increases or decreases.

Exchange rate effects also have a considerable influence on the valuation gains or losses determined as of the balance sheet date, depending on how the value of the Swiss franc develops in relation to the euro and the dollar.

The SNB will only provide details on the development of earnings when the annual report is presented on March 22nd.

What is clear, however, is that the decline in stock prices around the world contributed significantly to the decline.

The SNB holds around a quarter of its investments in shares.

The higher interest rates caused price losses for government bonds, which are another major investment focus.

According to the central bank, foreign currency holdings resulted in a total loss of CHF 131 billion.

The gold holdings, on the other hand, yielded a small valuation gain of CHF 0.4 billion because the price of gold rose slightly overall over the course of the year.

The huge shortfall erased the existing distribution reserve of CHF 102.5 billion and resulted in a balance sheet loss of around CHF 39 billion.

"In accordance with the provisions of the National Bank Act and the profit distribution agreement between the Federal Department of Finance and the SNB, this balance sheet loss makes it impossible to make a distribution for the 2022 financial year," the statement said.

Depending on how the market develops, profits in the double-digit billion range could again be made in the current year.

Whether this will then be high enough to make the public sector happy again with a distribution remains to be seen.

First of all, the SNB would have to replenish its distribution reserves properly.

The bank UBS also points out that the income from negative interest will no longer apply this year and that the SNB will have to pay interest on a large part of the sight deposits at an interest rate of 1 percent and more.

That makes the task even more challenging.