Swiss central bank reports heavy Q1 loss of CHF 4 billion 02/05/2008 00:00

Soaring Swiss franc against other major foreign currencies has caused the national bank to suffer huge losses.

2 May 2008

ZURICH - Switzerland's national bank on Friday reported a CHF 3.97 billion loss in the first quarter because of the slumping value of foreign currency reserves including U.S. dollars and British pounds.

This compared with a profit of CHF 2.16 billion in the first three months of last year.

The rise of the Swiss franc against other major currencies - including the U.S. dollar and the British pound - has hit the value of the national bank's foreign currency reserves when reported in francs, it said.

The current exchange rate of the U.S. dollar has dropped to CHF 0.954 from CHF 1.214 on 2 May in 2007.The Swiss National Bank has reduced the U.S. dollar share of its reserves to 28 percent in 2007 from 80 percent a decade earlier.

The bank also suffered a CHF 490 million loss in the value of its gold reserves, it said.

[AP / Expatica]