Latest news with #SwissNationalBank
Indian Express
6 days ago
- Business
- Indian Express
Did Indian money in Swiss banks grow more than three times in 2024? Govt responds
A Swiss National Bank report seemed to suggest that Indian money in Swiss banks had grown over three times in 2024 to Rs 37,600 crore, after declining by 71 per cent in the previous year. Now, the Indian government has responded to the claim, saying the data in the report shouldn't be 'used for analysing deposits held by residents of India in Switzerland'. 'There are some media reports based on Swiss National Bank (SNB) statistics which mention that Indian linked funds in Swiss banks have risen in 2024 as compared to previous year's amount,' Minister of State for Finance Pankaj Chowdhary said on Wednesday in response to a question in the Rajya Sabha. 'The media reports also mention that as per Swiss authorities, the data in respect of SNB statistics includes, inter alia, amounts due in respect of customer deposits (including in foreign branches of Swiss Banks located in any country), other liabilities as well as amounts due to banks,' he said, pointing out that 'Swiss authorities have clarified that the SNB annual banking statistics should not be used for analysing deposits held by residents of India in Switzerland'. Switzerland sharing info with India: Govt The minister went on to state that Switzerland has been providing annual financial information about Indian residents since 2018 under the Automatic Exchange of Information (AEOI) framework. The first such data transmission occurred in September 2019, and has continued since. 'India receives information about foreign assets and income from 100+ foreign tax jurisdictions. Whenever any instance of tax evasion is detected, appropriate action under Direct Tax Laws, including searches, surveys, enquiries, assessment of income, levy of taxes, penalties etc and filing of prosecution complaints in criminal court, wherever applicable, is taken,' Chowdhary said. The government said it has conducted 1,021 assessments under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 (BMA), till March 31, 2025. This has led to tax and penalty demands worth over Rs 35,105 crore and 163 prosecution complaints. 'The tax demand gets crystallized conclusively when appeals, if any, preferred before CIT(A), ITAT, Hon'ble High Court and Hon'ble Supreme Court are decided,' Chowdhary said. The minister said that Rs 338 crore has been recovered against tax/ penalty/interest demand raised under the BMA, between July 1, 2015 and March 31, 2025. What was the response to 3-month compliance window? Since the BMA came into force on July 1, 2015, 684 disclosures involving undisclosed foreign assets worth Rs 4,164 crore were made in the one-time compliance window under BMA from July 1, 2015 to September 30, 2015. The government mopped up Rs 2,476 crore by way of tax and penalty in such cases, he said.
Mint
21-07-2025
- Business
- Mint
Swiss sight deposits jump spurs talk of central bank currency intervention
ZURICH, July 21 (Reuters) - Cash lodged by commercial banks overnight with the Swiss National Bank rose to its highest level in 15 months last week, data showed on Monday, sparking speculation the central bank could be intervening to weaken the Swiss franc. Total sight deposits held by the SNB increased by 11.2 billion Swiss francs ($14.00 billion) to 475.3 billion francs, the highest level since April 2024. Normally an increase can be seen as a sign the SNB is buying foreign currencies from banks and crediting their accounts with newly created francs, a way to weaken the safe-haven currency whose high value has weighed on inflation. The SNB declined to comment on the data. GianLuigi Mandruzzato, an economist at EFG Bank, said the increase could mean the SNB intervened last week, although other factors could be involved. "With interest rates at zero and with the SNB reluctant to go negative, intervention is likely to be its favoured approach," he said. Maxime Botteron, an economist at UBS, said the sight deposit rise could signal interventions, although other explanations were more likely. "They could have intervened, but there was no urgent need to do so," he said. "The franc appreciated moderately against the euro last week, but did not reach the April high, and I don't think the SNB would intervene against the dollar." Instead, Botteron said the increase in sight deposits could reflect the expiration of SNB bills, where the principal is repaid to the banks who bought them at the end of their term and the money credited to their sight deposit accounts. The money could also be due to the SNB not rolling over existing repos, and instead repurchasing the instrument from banks and crediting their sight deposit accounts, Botteron said. Karsten Junius, chief economist at J. Safra Sarasin, doubted the SNB was intervening, with the sight deposit data more likely showing the SNB scaling back its use of bills and repos. "If they are reducing the use of these instruments, it could be because the SNB is trying to steer the SARON lower by taking less liquidity out of the market," he said, referring to the Swiss interbank rate. ($1 = 0.7999 Swiss francs) (Reporting by John Revill; Editing by Paul Simao)
Reuters
21-07-2025
- Business
- Reuters
Swiss sight deposits jump spurs talk of central bank currency intervention
ZURICH, July 21 (Reuters) - Cash lodged by commercial banks overnight with the Swiss National Bank rose to its highest level in 15 months last week, data showed on Monday, sparking speculation the central bank could be intervening to weaken the Swiss franc. Total sight deposits held by the SNB increased by 11.2 billion Swiss francs ($14.00 billion) to 475.3 billion francs, the highest level since April 2024. Normally an increase can be seen as a sign the SNB is buying foreign currencies from banks and crediting their accounts with newly created francs, a way to weaken the safe-haven currency whose high value has weighed on inflation. The SNB declined to comment on the data. GianLuigi Mandruzzato, an economist at EFG Bank, said the increase could mean the SNB intervened last week, although other factors could be involved. "With interest rates at zero and with the SNB reluctant to go negative, intervention is likely to be its favoured approach," he said. Maxime Botteron, an economist at UBS, said the sight deposit rise could signal interventions, although other explanations were more likely. "They could have intervened, but there was no urgent need to do so," he said. "The franc appreciated moderately against the euro last week, but did not reach the April high, and I don't think the SNB would intervene against the dollar." Instead, Botteron said the increase in sight deposits could reflect the expiration of SNB bills, where the principal is repaid to the banks who bought them at the end of their term and the money credited to their sight deposit accounts. The money could also be due to the SNB not rolling over existing repos, and instead repurchasing the instrument from banks and crediting their sight deposit accounts, Botteron said. Karsten Junius, chief economist at J. Safra Sarasin, doubted the SNB was intervening, with the sight deposit data more likely showing the SNB scaling back its use of bills and repos. "If they are reducing the use of these instruments, it could be because the SNB is trying to steer the SARON lower by taking less liquidity out of the market," he said, referring to the Swiss interbank rate. ($1 = 0.7999 Swiss francs)
India.com
16-07-2025
- Business
- India.com
This country has maximum reserve of dollar, it is not US, India, Japan, Russia, UK, name is….
When it comes to foreign exchange reserves, the global leader is assumed as the United States. However, China tops the list with the largest reserves of US dollars. It can help the country to strengthen its economic situation and also global influence. China Forex Reserves As per the latest data, China holds the largest foreign exchange reserves in the world, totaling around $3.6 trillion, and a major portion of this is in US dollars. These reserves are primarily due to China's massive trade surplus. As the country exports far more than it imports, and earns a major portion of foreign currency, especially American dollars. China uses these reserves to stabilize its own currency, the Yuan. Then invest in US Treasury bonds and cushion its economy during global financial instability. Japan: Second-Largest Reserve Holder After China, the country in 2nd position is Japan, with reserves around $1.3 to $1.4 trillion. Japan's reserves are similarly held in major global currencies like the US dollar and are used to manage exchange rates, to maintain investor confidence and also to support trade and capital flows. Japan's economic model, built around high exports, has helped it to gain more reserves. Switzerland At Third Switzerland holds the third-largest foreign exchange reserves, reported to be around $795 billion to over $1 trillion, depending on currency valuation changes. The Swiss National Bank has accumulated these reserves to prevent the Swiss Franc from becoming too strong, which could harm its export-driven economy. India At Fourth Globally India ranks fourth in the world with foreign exchange reserves between $650 billion and $675 billion, as of recent estimates. A large chunk of these reserves is in US dollars, held by the Reserve Bank of India (RBI). These reserves provide a buffer against global economic shocks, support the rupee in times of volatility and also help manage inflation and import bills.
Yahoo
14-07-2025
- Business
- Yahoo
Swiss zero rate squeeze on banks may lead to bumpy ride for borrowers
By Oliver Hirt, John Revill and Ariane Luthi ZURICH (Reuters) -Banks in Switzerland will be searching for other ways to squeeze borrowers as their lending margins are hit by the central bank's introduction of zero rates, analysts say, suggesting banking services and some types of credit may soon get costlier. The Swiss National Bank's June decision to cut its benchmark rate to zero took the country's borrowing costs to the lowest level among major economies - far lower than the neighbouring European Central Bank's key 2.0% deposit rate, for example. Following the SNB's two rate cuts this year, banks may see their net interest income fall by about 660 million Swiss francs ($830 million) this year, Daniel Geissmann from banking consultancy zeb estimates. Banks made roughly 20 billion francs from this business in 2024. "Zero interest rates are the worst-case scenario for banks," Geissmann said. "The banks lose because they can't pass on the rate cut to deposits." When interest rates were last around 0% between 2011 and 2015, Swiss banks' net interest rate margin fell from 1.4% to 1.1%, hitting profits, SNB data show. Geissmann estimated banks lost out on nearly 4 billion francs between 2011 and 2014, but noted the effect would likely be less pronounced this time because lenders are starting from a lower margin level. Reluctant to pass the cost on to depositors via sub-zero rates, if banks want to protect their profits they must make up for the missing revenues elsewhere. Martin Hess, chief economist of the Swiss Bankers Association (SBA), said credit could become more expensive as banks have to rely on costlier sources of funding such as capital market instruments instead of deposits. "Ultimately, this will be passed on to the real economy and customers," he said, pointing to higher mortgage costs. PROPERTY Ultra-low interest rates tend to fuel demand for property, with the 2011 to 2015 period seeing house prices jump by 15%, triple the rate in 2000-2005, SNB data show. "This increased risks in the property market of overvaluations and a correction, although it didn't happen last time," said GianLuigi Mandruzzato, an economist at EFG Bank. "These risks could emerge again." It was also challenging for insurers and pension funds, which found it hard to generate returns to cover their commitments as yields from bond investments plunged, he noted. UBS economist Maxime Botteron said that banks may also become increasingly reluctant to lend if the yield curve flattened further or inverted with rates at zero. The stock market is also not immune to the impact of the SNB's zero rates. With official rates well below those of other central banks in Europe and North America, shares of Switzerland's main listed banks have already begun to underperform those of their rivals. Shares of UBS, which faces tougher capital rules following its 2023 takeover of Credit Suisse, are up just 2.2% in 2025, while Julius Baer's shares are down 6.7% as new management seeks to draw a line under a recent run of setbacks. The Stoxx European Banks Index, by contrast, has risen 29.3% this year, highlighting the Swiss underperformance. Savings and loans banks are likely to be most affected by the erosion of lending margins. Banks that primarily collect deposits and issue mortgages such as Raiffeisen and Valiant generate more than 70% of their revenue from their interest business, company data show. Less affected are outright wealth and asset managers like Julius Baer and Vontobel, which derive only around 10% from interest income. Diversified lenders like UBS at about 15% and ZKB with 54% lie in between. Vontobel banking analyst Andreas Venditti said that how hard banks are hit by zero rates will ultimately depend on how long those rates stay in place. "The problem gets worse if you stay at zero for a longer period of time," he said. "Interest margins in Europe and especially in the U.S. are much higher." ($1 = 0.7966 Swiss francs)
