Zurich, Frankfurt If Thomas Jordan were a fund manager, he would probably have to fear for his job. At the end of October, the President of the Swiss National Bank (SNB) presented the biggest loss in the history of his institution: the SNB accumulated a deficit of 142 billion francs in the first nine months of the year – the majority due to book losses on bonds and shares that the bank holds as part of its foreign currency portfolio.
The equity ratio of the SNB is only six percent. If the markets continue to slide, the central bank’s equity should be exhausted by the end of the year. It could thus become the first central bank on the European continent to report a deficit that is not covered by equity.
The focus is on the SNB with its loss of billions because it is listed on the stock exchange and therefore has to balance the performance of the foreign currency portfolio at current market rates. But she is not alone with her billions in losses.
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