Swiss National Bank has opened a branch in Singapore, becoming the first non-Asian central bank with operations in the city-state as it seeks to better manage its portfolio of assets denominated in the region’s currencies.
The move by the Swiss national bank on Thursday is a sign of the growing importance of Singapore – often dubbed “the Switzerland of Asia” – as a base for asset and wealth managers.
SNB has a portfolio of about SFr50 billion in assets denominated in four Asian currencies: the Japanese yen, Korean won and the Singapore and Australian dollars. That is about double its share of Asian currencies as a proportion of total reserves compared with 2007.
The bank has total foreign currency reserves of SFr435 billion, equivalent to more than 70 per cent of Switzerland’s gross domestic product.
SNB’s reserves have soared since the bank in 2011 intervened to prevent the franc strengthening beyond SFr1.2 to the euro. Last year it was forced to spend SFr188 billion to hold the minimum exchange rate in the face of “haven” inflows from investors panicking about the eurozone crisis.
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