October 31, 2019 / 7:30 AM / 4 months ago

UPDATE 1-Swiss National Bank gets Q3 lift as easy money boosts investments

(Adds detail, background, analyst comment)

By John Revill

ZURICH, Oct 31 (Reuters) - The Swiss National Bank posted third-quarter profit of 13 billion Swiss francs ($13.17 billion) on Thursday, as easy money provided by central banks boosted its stock portfolio while political risks helped lift the price of gold.

The SNB made a profit of 8.98 billion francs from its foreign currency positions, reflecting increased value and dividends from the stocks and bonds it has bought to tame the Swiss franc.

It also made a profit of 3.5 billion francs on the 1,040 tonnes of gold it holds, reflecting the rise in the precious metal's market value this year.

The SNB has bought more foreign currency investments in recent months in an effort to dampen demand for the franc, which rose in July and August to its highest level against the euro in two years.

It held 798 billion francs in foreign-currency investments at the end of September, 34 billion francs more than a year earlier.

"The SNB's holdings have benefited from the rise in the value of equities and bonds, while the appreciation of the franc against the euro has been offset by its depreciation against the dollar," said Credit Suisse economist Maxime Botteron.

The MSCI International World Price Index, which represents nearly 1,700 global stocks, has risen nearly 19% this year as the U.S. Federal Reserve and the European Central Bank provided cheaper money by cutting their interest rates.

The SNB also made a third-quarter profit of 598 million francs from its Swiss franc holdings, mainly from the negative interest rates it charges on commercial banks on cash they park with it overnight.

$1 = 0.9873 Swiss francs Reporting by John Revill, editing by John Miller and Michael Shields

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