The Swiss National Bank suffered heavy first-quarter losses of 38.2 billion Swiss francs ($39.2 billion, 36.3 billion euros), it said Thursday, driven by stock market jitters over the coronavirus pandemic.
The central bank chalked up a loss of 31.9 billion francs on its equity investments, SNB said in a statement, plus foreign exchange losses of 17.1 billion francs.
However, the bank recorded gains on interest and dividend income. Helping to cushion losses was its stock of gold — seen as a safe haven since the start of the COVID-19 crisis.
“The first quarter of 2020 was dominated by the global spread of coronavirus. The measures taken to contain the pandemic seriously impacted the financial markets from mid-quarter onwards — and accordingly also the SNB’s result,” the bank said in a statement.
“The SNB’s financial result depends largely on developments in the gold, foreign exchange and capital markets. Strong fluctuations are therefore to be expected.”
Since 2015, the bank’s monetary policy has been based on a negative interest rate of minus 0.75 percent.
It can also intervene on the markets to reduce any pressure on the franc — one of the world’s safe havens, along with the yen, gold or German bonds, where investors take refuge during turbulent times.
To carry out its monetary policy, SNB relies on a large investment portfolio, which includes stocks, bonds and currencies in addition to gold reserves. Its results may therefore vary widely depending on the market.