Approaching the annual figures of the Swiss National Bank (SNB), UBS is releasing its profit forecasts. For 2022 as a whole, UBS expects SNB to incur a loss of approximately CHF 137 billion and accordingly cease distribution to the federal government and cantons.
Falling share prices, higher interest rates on bonds and a stronger Swiss franc contributed to the SNB’s annual loss, according to a UBS outlook. Regular dividend and interest payments would only marginally improve the outcome.
5 billion profit in the fourth quarter
The loss could have been even greater had it not been for a small profit in the fourth quarter. The financial investment climate improved somewhat in the last quarter, according to UBS. SNB’s financial result was later supported by rising share prices. However, higher interest rates and a stronger Swiss franc could have prevented an even better outcome. The bank estimates SNB’s fourth quarter profit to be around CHF 5 billion.
UBS estimates SNB’s distribution reserves to be around CHF 103 billion at the end of the year. Provisions for currency fluctuation reserves of about 10 billion francs will probably be deducted from this, meaning that the annual loss is too high of about 45 billion francs even for a minimal payment.
Probably no money for the federal government and the cantons
Accordingly, the federal government and cantons will have to forgo a distribution this year. According to UBS, a strong recovery in financial markets in the current 2023 will be required for a payment next year.
SNB will release results for the full year 2022 and the fourth quarter on Monday, January 9th. (SDA/shq)