Swiss National Bank Posts Record Loss in 1st Quarter

Swiss National Bank Posts Record Loss in 1st Quarter

Swiss National Bank Posts Record Loss in 1st Quarter

The FINANCIAL -- Switzerland's central bank swung to a loss in the first three months of the year as its decision to stop capping the franc cut sharply into the value of its euro reserves, according to Nasdaq.

On April 30, the Swiss National Bank said it posted a loss of 30.0 billion Swiss francs ($31.9 billion) in the first quarter, compared with a year-earlier profit of 4.4 billion francs. The quarterly loss was the bank's largest since the second quarter of 2013.

The loss was almost entirely caused by the erosion of its huge foreign-currency positions, which are dominated by the euro, and which amounted to 29.3 billion francs. The bank also recorded a 1 billion franc loss on its gold holdings, which are denominated in dollars.

The SNB, like most other central banks, is tasked with securing price stability and isn't obligated to make a book profit. But the bank's profits are redistributed to its owners, which include Switzerland's federal government and the country's 26 cantons, which are akin to U.S. states. The bank, which is publicly traded, also has private shareholders.