Gold, Bonds and Negative Interest Rates Give SNB a Q1 profit

Summary:
The Swiss National Bank has achieved a profit of 5.7 billion CHF in Q1/2016. The total yield on assets per annum was 3.4%.The main contribution comes from gold with price change of 10% in this quarter, hence a total yield of 48%.The total yield on debt was positive with +0.2% thanks to negative interest rates.The deflationary environment let to rising bond prices. Bonds, make up 74% of the SNB portfolio. Here the details of our calculation: Position Total Positionin bn CHF % of Total Portfolio Profit/Loss in Q1/2016in bn CHF Q1 P/L in %of position Yield on Assets (TWR) p.a. Total Assets 660 100% +5.7   +0.8%  +3.4% Gold  39.6 6% +4.1 +10.3% +48.3% Foreign Currency (Fiat)FX Valuation 610 92.4% -6.9  +0.2%  -4.5% Bonds (in foreign currency) 528 74% +6.2  +1.2%  +5.2% — Interest Income (in foreign ccy) +2.1  +0.4%  +1.7% Equities (in foreign currency) 122 18.4% -0.7  -0.6%  -2.3% — Dividend income +0.5  +0.4%  +1.6% CHF positions    3.9 0.6% +0.1  +2.6% +10.7% Yield on Debt (TWR) p.a. Total Debt 660 100% +0.33  +0.05%  +0.20% Total punished by neg. rates 165 25% +0.33  +0.18%  +0.

Topics:
George Dorgan considers the following as important: dividends, equities, George Dorgan on SNB, Gold, interest income, negative interests, Profit and Loss, SNB, Swiss National Bank

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