SNB Will Resume Payouts to State Coffers After Record Profit

(Bloomberg) — The Swiss National Bank anticipates a profit of about 80 billion francs ($88 billion) for 2024, a record result that will allow the institution to resume payouts to state coffers. 

Annual income from the central bank’s pile of foreign exchange reserves, accrued as a result of its years of purchases to weaken the franc, totaled around 67 billion francs, it said Thursday. The SNB also had a gain on its gold holdings, while Swiss franc positions resulted in a loss.

The central bank will make a payout of 3 billion francs to the federal government and the cantons for the first time in three years. The dividend for private shareholders will be 15 francs per share.

The resumption of payments might help quell domestic grumbling about the SNB at a time when the return of Donald Trump to the White House risks renewing international scrutiny on its foreign-exchange policy. 

The SNB keeps a close eye on the level of the franc because the currency’s gains feed through to inflation, but may recently have shirked from interventions. Available data show it largely refrained from stepping in foreign-exchange markets in the first nine months of 2024, instead using interest-rate cuts to deter speculators.

The franc typically attracts investors at times of uncertainty, and when Trump was last in power, Switzerland was classified as a currency manipulator thanks to the SNB’s FX actions. That label was subsequently removed. 

Separate data published on Thursday showed that the SNB had foreign currency reserves worth 731 billion francs at the end of December. That’s about 12% higher than a year earlier.

The earnings have no bearing on how the SNB sets monetary policy. Final results are due on March 3.

–With assistance from Kristian Siedenburg.

(Updates with FX reserves in penultimate paragraph)

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