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Swiss economy minister backs central bank leaders -paper

Published 01/29/2011, 06:17 AM
Updated 01/29/2011, 06:20 AM

* Schneider-Amman backs embattled SNB over franc -NZZ

* Banks not to blame for franc strength -UBS chairman

ZURICH, Jan 29 (Reuters) - Swiss Economy Minister Johann Schneider-Ammann backed the leadership of the Swiss National Bank in a newspaper interview on Saturday after calls for SNB chief chief Philipp Hildebrand to step down.

The SNB had done everything it could to stem the rise of the Swiss franc through currency market interventions, Schneider Amman told Swiss newspaper Neue Zuercher Zeitung.

"It is cheap 12 months later to point a finger at the decision taken at the time and to say the leadership did everything wrong," Schneider-Amman was reported as saying.

"No, it did the best thing possible and I have complete trust in the competency of the national bank and its leadership."

Top Swiss National Bank policymakers last week defended the currency interventions during the financial crisis, trying to fend off harsh criticism of the huge losses which have led to pressure for Hildebrand to go. [ID:nLDE70Q0B2]

The franc gained more than 15 percent against the euro last year and is trading near a recent record high, but the central bank has not stepped in to curb the franc since June.

Economists do not expect it to resume interventions as the economy is posting robust growth and the SNB ran up a loss of 21 billion francs as the value of its euro holdings plunged. [ID:nLDE70D1ZH]

The chairman of UBS said claims Switzerland's big banks were driving up the franc were "absurd" and also denied they were undermining Hildebrand.

"The market share of the Swiss banks in franc trading is around 5 percent globally. UBS has no influence on the exchange rate," Kaspar Villiger said in a separate NZZ interview.

"It has been alleged over again that the big banks are criticising the national bank and its chief. This is not the case. It is about a constructive dialogue about a problem."

Hildebrand said on Thursday the strong franc is hurting exporters in Switzerland and will slow growth this year, although some in its economy are benefiting from the currency's rise. [ID:nLAD005152] For a FACTBOX on recent SNB comments click on [ID:nLDE70G0OZ] (Reporting by Jason Rhodes; Editing by Catherine Evans)

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