After recording billion-franc losses in 2023 and 2022, the Swiss National Bank (SNB) returned to the black in 2024, reporting gross profits of around 80 billion francs. Here’s why the announcement matters and what it means for Switzerland as a whole.

Swiss National Bank returns to profit in 2024

In a statement, the SNB confirmed that it closed out 2024 having made an annual profit of 80 billion francs. Much of the income was generated via holding foreign currency (67 billion), followed by holdings in gold (21,2 billion). At the same time, positions held by the SNB in Swiss francs, currency reserves and future fees cost 53,2 billion francs, meaning once all expenses are added the bank registered a net profit of around 16 billion. 

The results are a major turnaround from recent years. In 2023, the SNB reported a net loss of 3,2 billion francs, while the bank lost 132,5 billion francs in 2022 as it attempted to prop up the Swiss economy amid rising inflation and the war in Ukraine.

Why does the SNB's recent windfall matter?

So why does the SNB’s profit matter? As the country’s central bank, the SNB issues all Swiss franc notes and coins and is responsible for maintaining the economy through interest rates, spending, investments, reserves and currency exchanges. Crucially, if the SNB makes enough of a profit, the government and Swiss cantons are given a dividend to spend.

As a result of the 2024 profit, 3 billion francs will be paid out. One-third will go to the federal government while two-thirds will go to the cantons.

According to the Federal Finance Administration, Canton Zurich will benefit the most from the payout, with their coffers set to swell by 358 million francs. They are followed by Canton Bern (238 million), Vaud (188 million) and Aargau (161 million francs). The fewest funds will go to Appenzell Innerrhoden (3,7 million), Uri (8,4 million) and Obwalden (8,7 million).

How will the extra money be spent?

The effects of this cash windfall are twofold. On the federal level, the 1-billion-franc injection of funds has meant that debates around radical austerity measures have been replaced with speculation about where the extra cash should be spent. At the same time, SRF reported that the windfall will cover the budget deficit of many Swiss cantons, while providing others with the means to spend more.

So how will the money be spent? Speaking to the Tages-Anzeiger, the Finance Director of Canton Zurich Ernst Stocker (SVP) said that while the announcement is a “good thing”, the money will be spent on servicing the region’s public debt, which stands at around 5 billion francs.

However, in regions where authorities run a profit, there are hopes that the extra money will lead to an expansion of public services. Geneva for example, which cut income tax by up to 11 percent and introduced free public transport for (some) young people in 2025 in response to high cantonal profits, will receive an extra 117 million francs thanks to the SNB windfall.

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