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(Kitco News) Switzerland's central bank posted profits in the first quarter, reporting growth in the value of its gold and foreign currency investments.
The Swiss National Bank said Thursday that it made a profit of $30 billion (26.9 billion Swiss francs) during the first quarter.
The $27 billion (24.2 billion francs) was the profit from its foreign currency positions amid a recovery of global bond and equity markets.
And an additional profit of $4.8 billion (4.3 billion francs) was from an increase in the value of the central bank's existing gold holdings. The SNB holds around 1,000 metric tons of bullion.
The solid gains come after the SNB reported its worst loss on record in 2022, posting a shortfall of $148 billion (132.5 billion francs).
The better Q1 results do not mean the SNB can return to dividend payments. "Our estimate of the profit potential for the SNB portfolio per year is 10 to 15 billion — the first quarter, therefore, represents a significant outlier to the upside," UBS economists Alessandro Bee and Florian Germanier wrote in a note this week.
In the meantime, Swiss customs data from March showed that Switzerland exported the most gold to mainland China in eight months, totaling 67,316 kg. Meanwhile, exports to India and Turkey fell to 16,550 kg and 10,748 kg, respectively. This was a dramatic shift for Turkey, which imported 43,217 kg from Switzerland in February.
In other news, a Swiss NGO denounced gold imported from Russia in February.
"Despite sanctions, Russian gold is entering Switzerland that may be linked to human rights violations in Sudan as well as co-financing the war of aggression against Ukraine, which is against international law," said Christoph Wiedmer, co-director of the Society for Threatened Peoples (STP).
That gold is coming into the country despite the sanctions put in place after Russia's invasion of Ukraine.
According to the NGO, Switzerland imported 18.9 metric tons of gold from Russia in February, which came in through the London precious metals market.
The NGO is urging for more transparency in the gold market amid concerns that some of the imported gold could belong to the head of Russia's private Wagner militia, Yevgeny Prigozhin.
"In recent years, the Wagner troops have been supporting authoritarian regimes in Sudan, Chad and Central Africa," the NGO said in a statement. "In return for military support, Wagner receives economic benefits, in Sudan, for example, access to gold deposits there."
