Summary of a speech delivered by the President of the Bank Council to the Annual General Meeting of Shareholders of the Swiss National Bank
Hansueli Raggenbass, President of the Bank Council
Annual General Meeting of Shareholders of the Swiss National Bank, 25 April 2003, 25.04.2003
The President of the Bank Council of the Swiss National Bank, Hansueli Raggenbass, commented the central bank's financial statements for 2002 at the Annual General Meeting of Shareholders. In his statement, he dealt in detail with the free assets (the gold no longer needed for monetary policy purposes including the proceeds from the sale of gold); he also elaborated on corporate governance and the revision of the National Bank Law.
The financial statements for 2002 reflect once again the considerable gold price, exchange rate and interest rate risks that the Bank faces. The National Bank depends on adequate currency reserves, which can only fulfil their function satisfactorily if they are not hedged on the market. Due to these risks, the central bank does not distribute its entire earnings surplus; it sets aside provisions and augments these in line with the average growth of nominal gross domestic product.
The free assets – including the income from the invested proceeds from gold sales – amounted to Sfr 21 billion at the end of last year. If no gold had been sold in the past three years, total free assets as at the end of 2002 would have been Sfr 1.1 billion lower.
In the course of the revision of the National Bank Law now under way corporate governance is to be strengthened at the National Bank since confidence in the monetary institution is of considerable social significance. The proposed new structure of the National Bank is aimed at establishing more efficient and more professional supervision with stringent checks and balances. The Bank Committee will be dissolved and the Bank Council streamlined and strengthened.