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Services on behalf of the Confederation

Mandate

Based on art. 5 para. 4 and art 11 of the National Bank Act (NBA), the National Bank shall provide banking services to the Swiss Confederation.

Remuneration for banking services

The services will be provided by the National Bank for an adequate compensation. However, the services shall be provided free of charge if they facilitate the implementation of monetary policy. Remunerable services include payment transactions, liquidity management and custody of securities. The details of the services provided and the remuneration were laid down in agreements concluded between the Federal Finance Administration and the National Bank.

Liquidity management

Up until the end of 2004, the confederation held its liquid funds in the form of sight deposits or short-term time deposits at the National Bank. In the event of liquidity shortages, the National Bank arranged money market loans from banks for the Confederation. The National Bank pays interest at market rates on time deposits held with it by the Confederation, while sight deposits are interest bearing up to a certain level.

Issuing activity

In 2016, the SNB issued both MMDRCs and Confederation bonds on behalf of and for the account of the Confederation. MMDRCs amounting to CHF 140.6 billion were subscribed, of which CHF 23.4 billion was allocated. The corresponding figures for Confederation bonds were CHF 5.1 billion and CHF 3.2 billion respectively. Issues of MMDRCs and Confederation bonds were effected by auction on the SIX Repo Ltd trading platform.