SNB Sees Profitability Return with Equity Portfolio Boost

The Swiss National Bank (SNB) is expected to return to profitability in the second quarter after posting a significant loss of half a billion francs in the first quarter, according to economists at UBS.

UBS analysts Alessandro Bee and Florian Germanier predict that the SNB's equity portfolio will increase by around CHF30 billion (14%) during this period, which would help offset losses from other areas. However, the decline of more than 10% in gold prices has reduced the value of the bank's massive gold stockpile by CHF15 billion.

The SNB's debt securities portfolio has been affected by varying interest rates and yields across different regions, resulting in a balanced outcome. Additionally, the depreciation of the Swiss franc against the dollar generated foreign exchange gains of around CHF3 billion, while interest income and dividends contributed positively to the bank's results with CHF4 billion.