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At a Swiss National Bank Money Market Event on Oct. 29, 2026, Petra Tschudin and Thomas Moser described how the SNB provides central bank liquidity only against sufficient collateral. They said the SNB GC Basket supports monetary policy and payments, while the collateral framework protects the central bank against credit risk.
Swiss National Bank officials Petra Tschudin and Thomas Moser set out the central bank’s approach to providing liquidity against collateral at its Money Market Event in Geneva on Oct. 29, 2026. They said the framework supports the SNB’s monetary-policy operations and payment services while limiting its exposure if a borrowing counterparty cannot meet its obligations.
The officials said the SNB provides central bank liquidity to the financial system to carry out statutory tasks. These include implementing monetary policy in the Swiss franc money market, supporting cashless payments and contributing to financial stability. The speech focused on the first two purposes; it also referred to liquidity support provided during the Credit Suisse crisis as an example of the third.
Under the National Bank Act, liquidity must be provided against sufficient collateral. The SNB’s collateral policy sets the principles for collateral used in its credit and repo transactions. According to the speakers, pledged assets give the SNB recourse if a counterparty defaults, limiting credit risk and helping protect the central bank’s balance sheet.
The officials described the SNB GC Basket as central to implementing monetary policy and supporting payments. They said it combines high quality requirements with broad international coverage and has become a collateral standard in the Swiss interbank repo market. A shared standard and integrated market infrastructure, they said, make collateral easier to mobilise.
Collateral Supports Swiss Market Operations
Collateral rules affect more than the SNB’s own exposure. They shape which assets banks can use to access central bank liquidity and influence how readily liquidity can be redistributed between financial institutions. The speakers described collateral policy as a technical framework with consequences for the day-to-day functioning of the money market.
For monetary policy, repo transactions allow the SNB to provide or absorb liquidity to keep short-term money market rates close to its policy rate. For payments, banks may need funds at short notice because incoming and outgoing payments do not arrive at the same time. The SNB’s ability to lend against eligible collateral can help banks manage those timing needs.
The framework also matters during stress. Collateralisation limits the SNB’s potential losses if a counterparty fails to repay, while the availability and operational readiness of eligible assets affect how quickly liquidity can be accessed. The officials presented the GC Basket and shared market infrastructure as ways to support that mobilisation; they did not quantify the effects in the supplied speech text.
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Three Statutory Liquidity Roles
The SNB’s liquidity provision is tied to responsibilities assigned under the National Bank Act. In the Swiss franc money market, financial institutions make short-term transactions with one another, with payments settled through sight deposits at the SNB. The central bank uses repo operations to manage liquidity conditions and influence short-term rates.
The speakers contrasted different operating conditions. During the negative interest-rate period, they said, the SNB sometimes supplied liquidity even when substantial liquidity was already in the system, aiming to counter temporary upward pressure on short-term rates. In the environment described at the event—where the policy rate was non-negative and liquidity remained high—open market operations were being used to absorb liquidity.
The other roles are payment support and financial stability. Banks can face short-term liquidity needs as customer and interbank payments move through the day. The SNB can also provide liquidity support when a bank considers its own buffers insufficient. The speech cited support during the Credit Suisse crisis but did not provide details of those operations in the supplied material.
“The SNB’s collateral policy protects its balance sheet and ensures that liquidity is provided in an effective, efficient and transparent manner.”
— Petra Tschudin and Thomas Moser, SNB Money Market Event speech
Policy Changes Not Specified
The speech describes the SNB’s existing approach and ongoing review, but the supplied material does not announce a specific change to eligibility rules, collateral haircuts, or the composition of the GC Basket. It also gives no timetable for a policy revision or detailed measures for how any future adjustment would be implemented.
The officials’ presentation does not quantify how much liquidity is currently provided or absorbed, nor does it give a breakdown of eligible collateral or operational limits. The source material therefore supports a description of the framework and its stated purposes, not an assessment of the size or measured impact of individual operations.
SNB Review Continues
The SNB said it reviews its collateral policy on an ongoing basis and adjusts it when needed to reflect changes in market conditions and technology. The speech did not name a next review date, announce a consultation or set out a specific forthcoming policy decision.
For now, the described framework continues to govern collateral for the SNB’s credit and repo transactions. Any concrete changes to collateral eligibility or the GC Basket would need to be confirmed in a subsequent SNB announcement or policy publication.
Key Questions
What did the SNB officials discuss on Oct. 29, 2026?
Petra Tschudin and Thomas Moser presented the SNB’s approach to providing liquidity against collateral at the central bank’s Money Market Event in Geneva.
Why does the SNB require collateral for liquidity?
Collateral gives the SNB recourse if a counterparty cannot meet its obligations. The officials said this limits credit risk and helps protect the SNB’s balance sheet.
What is the SNB GC Basket?
It is a pool of collateral the officials described as important to monetary policy implementation and payments. They said it has high quality requirements, broad international coverage and is established as a standard in the Swiss interbank repo market.
Did the SNB announce new collateral rules?
No specific rule change was announced in the supplied speech material. The officials said the SNB reviews its collateral policy on an ongoing basis.
What liquidity tasks did the speech cover?
The event focused on liquidity for the Swiss franc money market and cashless payments. The speakers also identified financial stability as a statutory role for which the SNB can provide liquidity support.
Source: snb.ch
