The Switzerland National Bank, also known as the SNB, Swiss National Bank, Schweizerische Nationalbank (no space between National and Bank), Banque nationale suisse, Banca nazionale svizzera and Banca naziunala svizra is the central bank of Switzerland since 1907. It’s mandate or primary responsibility is devising Switzerland’s monetary policy to ensure price stability while being mindful of the Swiss economy.
The Swiss National Bank considers a price stable environment to be at or less than 2 percent inflation per year without going into deflation. The primary way the SNB adjusts its monetary policy to ensure that the rate of inflation in the Swiss economy doesn’t rise above 2 percent per year or descend into deflation is by making changes to the target three month London Interbank Offered Rate. The Switzerland National Bank is also responsible for issuing the official currency of Switzerland, the Swiss franc. That includes banknotes and coins. The Swiss franc’s ISO currency code is CHF – 756.
Here is an aerial shot of the Swiss National Bank
The executive body within the Switzerland National Bank that is responsible for devising and executing Switzerland’s monetary policy is called the Bank Council. Members of the Bank Council are those who have power and control over the business in the SNB.
There are 11 members on the Bank Council at any one time. Six members are appointed into the Bank Council by the Swiss Federal Council. The other five members are appointed by the shareholders of the Swiss National Bank. You may be thinking why the SNB has shareholders. I will discuss more on that shortly. Members of the Bank Council serves a minimum of 4 years and a maximum of 12 years.
Now, regarding the shareholders. The reason why the Swiss National Bank as shareholders is because the Swiss National Bank is also joint-stock company and is traded on the Swiss stock exchange under the ticker ‘SWX’.
Locations of the Switzerland National Bank
- Zurich, Switzerland
- Geneva, Switzerland
Representative Office Locations
- Basel, Switzerland
St. Gallen, Switzerland
The National Bank Act
The National Bank Act, commonly abbreviated as ‘NBA’, sets the Swiss National Bank’s mandate and gives the bank its independence from the Federal Council, Parliament and the public. However, the National Bank Act does mandates that the SNB remains accountable to the Swiss government and to provide information on its business dealings to the Swiss government and public. The NBA also allows the SNB to keep its profits so long as it helps with its monetary policies. The National Bank Act was implemented on May 1st, 2004.