The Swiss National Bank Council is the body which directs, oversees and controls the Swiss National Bank. On 16 December, 2022, the Swiss National Bank (SNB) announced that they have nominated University of St.Gallen (HSG) Professor of Finance and Systemic Risk at the School of Finance (SoF-HSG) Angelo Ranaldo to the SNB Bank Council. This prestigious role oversees and controls the Swiss National Bank. It is a body under Swiss federal law (Bundesgesetz über die Schweizerische Nationalbank), which states (Art. 40): “To be eligible for election as members of the Bank Council, persons must have Swiss citizenship, an impeccable reputation and a recognised knowledge of the fields of banking and financial services, business administration, economic policy, or an academic field.” If accepted by the SNB general assembly in April 2023, Ranaldo will serve at minimum a four-year term.

Professor Ranaldo, how did it come about that you were nominated for the SNB Bank Council?

On 4 November, 2022, I was interviewed by the selection and nomination committee of the Swiss National Bank (SNB) – Bank Council. I thought the interview went well and later that afternoon, SNB Bank Council President Barbara Janom Steiner called me and informed me that they would like me to serve. I gladly accepted. 
Former HSG professor Monika Bütler also formally served the SNB Bank Council from 2010 to 2022.

Why is this appointment important? 

Because the SNB is crucial to the welfare of Switzerland. On top of issuing Swiss francs, they are the independent authority that steers monetary policy and ensure financial stability. 
Swiss federal law prescribes three corporate bodies of the National Bank, which are the General Meeting of Shareholders, the Governing Board and the Bank Council.

What is the specific role of the bank council? 

The Bank Council is somewhat like the board of directors of the SNB. Its main task is to oversee and control the conduct of business by the SNB. Article 42 of the federal law states that there are 12 areas of focus for the Council, which includes overseeing the investment of assets and risk management.

How many people are on the Bank Council? 

There are 11 members on the Bank Council and Swiss law requires that they must be “Persons with an impeccable reputation and a recognised knowledge of monetary, banking and financial issues.” Normally there two academics chosen to serve and I, along with Professor Rajna Gibson from the University of Geneva, have been appointed. 

How do you think you will contribute to the bank council?

I have always carried out advanced research projects on financial stability and monetary policy issues. So I can offer cutting-edge knowledge and technical expertise. All of my work in this area should be useful in evaluating subjects such as investment policy and risk models adopted by the national bank. 

Currently, what are issues and challenges facing the SNB?

The main task of the Bank Council is to empower the SNB in the best possible way to carry out its main tasks, which is to preserve price stability and to continue to be a resilient financial system. The main challenge that we face at the moment is inflation. Being an open economy, Switzerland is of course exposed to external shocks such as the war in Ukraine. 

What role does the Swiss franc play?

An important role. Our country benefits from many positive aspects such as sound public finances, competitive industry and services, a good education system, and so on. The strong Swiss franc represents the "face value" of all these good things. In the current context of uncertainty, the Swiss franc has become even stronger with important consequences for the monetary and investment policy of the SNB. On the one hand, it eases inflationary pressure. But on the other, it devalues the foreign exchange reserves of the SNB. This is why inflation is lower in Switzerland than in other countries, but recently the SNB has had a large loss and we must continue to analyse all of these factors when proceeding to make future decisions.

Angelo Ranaldo is a full professor of finance and systemic risk at HSG and holds a senior chair at the Swiss Finance Institute (SFI-HSG). He has served as a consultant and scientific advisor to international institutions such as the Bank of England, Bank of International Settlements, European Central Bank and European Money Market Institute. The European Central Bank awarded him the 2018 Duisenberg Fellowship.

Image: Keystone / SNB