Schweizerische Nationalbank · SIX:SNBN

Schweizerische Nationalbank — Investor Presentation (June 2009)

25 slides from Schweizerische Nationalbank's investor presentation, Jun 16, 2009

  1. Slide 1: Capital Flows: Build-ups and let-downs

    Capital p Flows: Build-ups p and let-downs Dr. Laura E. Kodres M n t r and Monetary nd Capital C pit l Markets M rk t Department D p rtm nt June 16, 2009

  2. Slide 2: Outline

    Outline „ Recent history of capital inflows and net flows „ Forecasts of capital p flows ‰ Baseline ‰ Econometric work „ Policies for medium term ‰ What financial system characteristics influence capital flows

  3. Slide 3: Total Capital Inflows

    Total Capital Inflows (I billions (In billi off U.S. U S dollars) d ll ) Developed and Emerging Market Economies Emerging Market economies 10000 1800 1600 8000 1400 1200 6000 1000 800 4000 600 400 2000 200 0 0 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 1994 1995 1996 1997

  4. Slide 4: Composition of Capital Inflows

    Composition of Capital Inflows (I billions (In billi off U.S. U S dollars) d ll ) Developed and Emerging Emerging Market economies Market Economies 5000 800 4000 600 Bank loans 400 3000 Foreign direct investment 200 Equity 2000 Bonds 0 Bonds Foreign direct investment 1000 Bank loans -200 200 Equity

  5. Slide 5: Emerging and Developing Economies: Net Capital Flows

    Emerging and Developing Economies: Net Capital Flows (In billions of U.S. U S dollars) Emerging and Developing Economies 2003 2004 2005 2006 2007 2008 2009 2010 Private direct flows, net 161.3 183.9 243.7 241.4 359.0 459.3 312.8 303.1 Private portfolio investment, net -3.8 10.0 -5.6 -100.7 39.5 -155

  6. Slide 6: Emerging and Developing Economies: Net Capital Flows

    Emerging and Developing Economies: Net Capital Flows (In billions of U.S. U S dollars) 1000 Private direct flows, net Private portfolio investment, net Oth private Other i t capital it l flows, fl nett Official flows, net 500 Reserves Total capital flows 0 -500 -1000 -1500 2003 2004 2005 2006 2007 2

  7. Slide 7: Central and Eastern Europe: Net Capital Flows

    Central and Eastern Europe: Net Capital Flows (In billions of U.S. U S dollars) 200 Private direct flows, net Private portfolio investment, net Other private capital flows, net 150 Official flows, net Reserves Total capital p flows 100 50 0 -50 -100 2003 2004 2005 2006 2007 2008 2009 2010 Source: IM

  8. Slide 8: Emerging Market Net Private Capital Flows

    Emerging Market Net Private Capital Flows (I percent off GDP) (In 6 Private other investment, net E ti Estimates t 5 Private portfolio investment, net Total private capital flows, net 4 Private FDI inflows, net 3 2 1 0 -1 -2 -3 1980 1985 1990 1995 2000 2005 2010 Source: IMF, World Economic Outlook d

  9. Slide 9: Emerging Europe: Real Credit Growth to the Private Sector and Output

    Emerging Europe: Real Credit Growth to the Private Sector and Output (In percent, year-on-year) 40 20 Industrial production (right scale) 15 35 10 5 30 0 25 -5 Real credit growth (left scale) -10 20 -15 15 -20 Sep-03 Sep 03 Sep-04 Sep 04 Sep-05 Sep 05 Sep-06 Sep 06 Sep-07 Sep 07 Sep-08 Sep 08 Source

  10. Slide 10: Cross-Border Assets as a Proportion of Total Assets

    Cross-Border Assets as a Proportion of Total Assets (Annual change in percentage points) 4 3 2 1 0 -1 -2 -3 2003 2004 2005 2006 2007 2008 2009 Sources: Bank for International Settlements; and IMF staff estimates.

  11. Slide 11: BIS Reporting Banks: Cross-Border Liabilities, Exchange-Rate-adjusted Changes

    BIS Reporting Banks: Cross-Border Liabilities, Exchange-Rate-adjusted Changes (In billions of U.S. dollars) 4000 Related offices Interbank 3000 Monetary authorities Nonbank Total 2000 1000 0 -1000 -2000 Q106 Q206 Q306 Q406 Q107 Q207 Q307 Q407 Q108 Q208 Q308 Q408 Q Q Q Q Q Q Q Q Q Q Q Q Sources: Bank

  12. Slide 12: Net Private Other Investment Flows to Emerging Markets

    Net Private Other Investment Flows to E Emerging i Markets M k t (In percent of GDP, average in panel) 4 3 2 1 0 -1 -2 Data -3 -4 Panel vector autoregression forecast (given GFSR projection for U.S. credit growth) -5 5 -6 1990 1994 1998 2002 2006 2010 Sources: IMF, World Economic Outlook database; a

  13. Slide 13: Emerging Market Real Credit Growth

    Emerging Market Real Credit Growth (I percent, (In t year-on-year, average in i panel) l) 20 15 10 5 0 -5 Data -10 Panel vector autogression forecast (given GFSR projection for U.S. credit growth) -15 -20 1990 1994 1998 2002 2006 2010 Sources: IMF, World Economic Outlook database; and IMF staff esti

  14. Slide 14: Emerging Market GDP Growth

    Emerging Market GDP Growth (I percent, (In t year-on-year, average in i panel) l) 8 7 6 5 4 3 2 1 0 Data -1 Panel vector autogression forecast (given GFSR projection for -2 U.S. credit growth) -3 1990 1994 1998 2002 2006 2010 Sources: IMF, World Economic Outlook database; and IMF staff estimates.

  15. Slide 15: Caveats to Econometric Capital Flows Study

    Caveats to Econometric Capital p Flows Study „ Constant model coefficients across countries. „ Assumes “typical” yp p policy y response p from EM countries, without accounting for larger reserves and better fiscal situations situations. „ Does not factor in global policy response and increase ffundi

  16. Slide 16: Cumulative EM Fund Flows and EM Bond Issuance

    Cumulative EM Fund Flows EM Bond Issuance 1/ (In billions of U.S. dollars) ( billions (In b ll off U.S. dollars) d ll ) 120 140 EMEA 100 120 Latam Asia 80 Equity funds 100 60 80 40 60 D bt ffunds Debt d 20 40 0 20 -20 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2007 2008 2009 Sources: Emerging Po

  17. Slide 17: Panel Least-Squares Estimation of Determinants of Capital Inflows, 1998-2006

    Panel Least-Squares Estimation of Determinants of C it l Inflows, Capital I fl 1998-2006 1998 2006 1/ All Countries Emerging Markets Financial Development Indicators Equity market turnover √ √ Equity market capitalization ― ― p Financial openness √ √ Corporate governance quality √ ― Accounting stand

  18. Slide 18: Panel GMM Estimation of the Determinants of the Standard Deviation of Capital Inflows

    Panel GMM Estimation of the Determinants of the Standard Deviation of Capital Inflows, 1998-2006 1/ All Countries Emerging Markets Financial Development Indicators Equity market turnover ― ― Equity market capitalization ― ― Financial openness √ √ Corporate governance quality ― ― Accounting standards

  19. Slide 19: Market Infrastructure and Volatility of Total Capital Inflows: Voice and Accountability

    Market Infrastructure and Volatility of Total Capital Inflows Voice and Accountability 6 atility / inflow llevel 5 4 Estonia 3 Romania Czech Rep Russia 2 ow vola Lithuania Slovenia Bulgaria Turkey Hungary 1 Croatia Inflo Latvia Israel 0 Poland -2 2 -1.5 15 -1 1 -0.5 05 0 05 0.5 1 15 1.5 2 Note: Infl

  20. Slide 20: Market Infrastructure and Volatility of Total Capital Inflows: Political Stability

    Market Infrastructure and Volatility of Total Capital Inflows Political Stability 6 w level 5 Inflow volatility / inflow 4 Latvia R Romania i Lithuania 3 Czech Rep Hungary 2 Russia Turkey Bulgaria Estonia Slovenia 1 Israel Croatia 0 Poland -2 -1.5 -1 -0.5 0 0.5 1 1.5 2 Note: Inflow volatility measur

  21. Slide 21: Market Infrastructure and Volatility of Total Capital Inflows: Government Effectiveness

    Market Infrastructure and Volatility of Total Capital Inflows Government Effectiveness 6 w level 5 atility / inflow 4 3 Croatia Hungary Lithuania 2 Estonia Inflow vola Bulgaria B l i Russia Israel Latvia 1 Turkey Romania Poland Slovenia 0 Czech Rep -2 2 -1.5 15 -1 1 -0.5 05 0 05 0.5 1 15 1.5 2 Note:

  22. Slide 22: Market Infrastructure and Volatility of Total Capital Inflows: Regulatory Quality

    Market Infrastructure and Volatility of Total Capital Inflows Regulatory Quality 6 w level 5 olatility / inflow 4 Turkey Lithuania 3 Slovenia Israel Latvia 2 Romania nflow vo Hungary Bulgaria Estonia Russia 1 In Poland 0 Croatia Czech Rep -2 -1 5 -1.5 -1 -0 5 -0.5 0 05 0.5 1 15 1.5 2 Note: Inflow vo

  23. Slide 23: Market Infrastructure and Volatility of Total Capital Inflows: Rule of Law

    Market Infrastructure and Volatility of Total Capital Inflows Rule of Law 6 atility / inflow llevel 5 4 Latvia Lithuania 3 Hungary Estonia Infflow vola 2 Turkey T k Slovenia Bulgaria Israel Russia 1 Romania Poland 0 Croatia Czech Rep -2 2 -1.5 15 -1 1 -0.5 05 0 05 0.5 1 15 1.5 2 Note: Inflow volatil

  24. Slide 24: Market Infrastructure and Volatility of Total Capital Inflows: Control of Corruption

    Market Infrastructure and Volatility of Total Capital Inflows Control of Corruption 6 w level 5 Inflow volatility / inflow 4 Latvia 3 Lithuania Slovenia Turkey y Hungary Israel 2 Estonia Bulgaria Romania Russia 1 P l d Poland 0 Croatia Czech Rep -2 2 -1.5 15 -1 1 -0.5 05 0 05 0.5 1 15 1.5 2 Note: In

  25. Slide 25: Capital Flows: Build-ups and Let-downs

    Capital Flows: Build Build-ups ups and Let-downs Let downs Dr Laura E. Dr. E Kodres, Kodres IMF June 16, 2009

Schweizerische Nationalbank — Investor Presentation (June 2009) on 6ix