SNB Sight Deposits Inch Up After Franc Interventions on Greece

Sight deposits at the Swiss National Bank rose 0.3 percent last week after it uncharacteristically admitted to stemming the franc’s appreciation against the euro.

SNB President Thomas Jordan said a week ago the central bank had waded into markets to “stabilize” the surging currency after Greek Prime Minister Alexis Tsipras called a referendum. That’s the first time this year a Swiss policy maker had admitted to making good on a frequently reiterated pledge to intervene.

The SNB data published on Monday showed that sight deposits increased to 457.9 billion francs ($485 billion) in the week ending July 3 from 456.6 billion a week earlier. Sight deposits of domestic banks dipped slightly to 391.1 billion.

“More was probably done than the data shows,” said Ursina Kubli, a foreign-exchange analyst at  Bank J Safra Sarasin Ltd. in Zurich. “And I think the communication from Mr. Jordan had its effect in talking down the currency.”

The franc, typically sought by investors at times of market stress, has appreciated more than 15 percent against the euro since the central bank abandoned its franc cap of 1.20 per euro in January. Last week’s slight increase in sight deposits compares with a rise of 6.5 percent in the week ending Jan. 23, the first full week after the SNB gave up its ceiling.

Sight deposits are the cash commercial banks hold with the central bank and serve as a proxy measure for interventions. In the past, when the SNB defended its currency ceiling, the deposits were credited with the amount of francs sold.

The transactions take two days to settle, and the figures published are a weekly average, which could mean the full extent of the SNB’s recent interventions is not yet reflected in the data. SNB Spokeswoman Silvia Oppliger declined to comment on the change.

The franc opened higher versus the euro on Monday after Greeks rejected austerity measures demanded by creditors in the referendum. It later erased the gain and was little changed at 1.0440 per euro as of 11:20 a.m. Zurich time.

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