ZURICH (Reuters) -Swiss National Bank said on Monday its 2021 profit rose to 26.3 billion Swiss francs ($28.57 billion), boosted by earnings from a massive pile of foreign currency investments built up during its campaign to restrain the safe-haven Swiss franc.
The figure, up from a 20.9 billion franc profit a year earlier, reflected gains from booming stock markets and increases in payments from the central bank’s bond holdings.
The figure was the fourth highest since the SNB was founded in 1907. In provisional figures in January, the central bank had said it expected a profit of around 26 billion francs for 2021.
The profit means the SNB can make the maximum payout to the Swiss central government and the local authorities of 6 billion francs.
The SNB, unusual among central banks in having publicly traded shares, proposed a dividend of 15 francs – the legal maximum.
During 2021, the SNB made a profit of 25.7 billion francs from its foreign currency positions, which by the end of 2021 had risen to 966 billion francs. It also made a valuation loss of 100 million francs on its gold holdings.
It made a profit 1.1 billion francs from its Swiss franc positions, mainly negative interest rates it charges commercial banks for holding cash overnight.
The SNB’s massive profits have meant the central bank faces the prospect of a labour union-led raid on its profits to prop up Switzerland’s public pension scheme.
The central bank has also been battling increased demand for the Swiss franc, which has risen in value as the currency attracted safe-haven inflows due to the conflict in Ukraine.
($1 = 0.9205 Swiss francs)
(Reporting by John Revill; Editing by Zuzanna Szymanska)
