The Swiss National Bank (SNB) posted a yearly profit of 48.9 billion Swiss francs ($50.71 billion), the central bank stated Monday and said it could double its payout to Switzerland’s regional and central governments.
The SNB posted a profit of 40.3 billion francs from its foreign currency standings last year, lifted by huge gains from foreign currency investments bought to weaken the safe-haven franc.
It made a 6.9 billion franc gain from its gold holdings and 2.1 billion from its Swiss franc positions.
The profit was the second-highest in the bank’s 113-year history and meant the SNB can improve its payout to 4 billion francs to cantons and the Swiss federal government.
The rise, from the usual 2 billion franc payout, came after the SNB and the Swiss finance ministry signed a settlement to increase the utmost profit distribution in case of big profits. One-third of the money will go to the Swiss government and two thirds to the nation’s cantons and could head off the criticism of the SNB for its negative rates of interest policy.
The central bank charges the world’s lowest rate of interest of -0.75% on commercial bank deposits it keeps over a specific threshold, a measure meant to weaken investor appetite for the franc.
Over the past year, the SNB posted a profit of 1.94 billion francs from negative rates, which have become more and more unpopular among banks, insurers and pension funds that see it as a charge on their businesses.
Regardless of the increased 4 billion franc payout, the SNB proposed keeping its dividend for shareholders at 15 Swiss francs.