SNBomb – Reactions from 12 forex brokers - page 3

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Swiss National Bank says its reduced the group of sight deposit account holders that

SNB tightens the net on those to bear the brunt of negative rates

  • Negative rate will also apply to public entities
  • Sight deposit accounts of Zurich and Geneva to be wound up
  • Account of SNB pension fund will be subject to negative rates
  • New rules to come into play May 1st
  • Accounts will have CHF10m minimum exemption

The SNB kept the negative rate to particular limits on who it would affect. Now they are snaring more domestic accounts into the pot.

Swiss pairs have ripped higher on the news which is likely to lead to money flowing out of Switzerland looking for better yield elsewhere

Here's the full release from the SNB;

 

Soon they are going to make everybody pay if they have money in a bank

 
morro:
Soon they are going to make everybody pay if they have money in a bank

Soon we are not going to have any money - only the 1% will be allowed to have it

 

The "War On Cash" Migrates To Switzerland

Banks Increasingly Refuse Cash Withdrawals – Switzerland Joins the Fun

The war on cash is proliferating globally. It appears that the private members of the world’s banking cartels are increasingly joining the fun, even if it means trampling on the rights of their customers.

Yesterday we came across an article at Zerohedge, in which Dr. Salerno of the Mises Institute notes that JP Morgan Chase has apparently joined the “war on cash”, by “restricting the use of cash in selected markets, restricting borrowers from making cash payments on credit cards, mortgages, equity lines and auto loans, as well as prohibiting storage of cash in safe deposit boxes”.

This reminded us immediately that we have just come across another small article in the local European press (courtesy of Dan Popescu), in which a Swiss pension fund manager discusses his plight with the SNB’s bizarre negative interest rate policy. In Switzerland this policy has long ago led to negative deposit rates at the commercial banks as well. The difference to other jurisdictions is however that negative interest rates have become so pronounced, that it is by now worth it to simply withdraw one’s cash and put it into an insured vault.

Having realized this, said pension fund manager, after calculating that he would save at least 25,000 CHF per year on every CHF 10 m. deposit by putting the cash into a vault, told his bank that he was about to make a rather big withdrawal very soon. After all, as a pension fund manager he has a fiduciary duty to his clients, and if he can save money based on a technicality, he has to do it.

A Legally Murky Situation – but Collectivism Wins Out What happened next is truly stunning. Surely everybody is aware that Switzerland regularly makes it to the top three on the list of countries with the highest degree of economic freedom. At the same time, it has a central bank whose board members are wedded to Keynesian nostrums similar to those of other central banks. This is no wonder, as nowadays, economists are trained in an academic environment that is dripping with the most vicious statism imaginable. As a result, withdrawing one’s cash is evidently regarded as “interference with the SNB’s monetary policy goals”. Thus SRF reports:

“Since the national bank has introduced negative interest rates, pension funds in the country are in trouble. Banks are passing the negative rates on to them. This results in the saved pension money shrinking, instead of producing a return. A number of pension funds are therefore thinking about keeping their money in an external vault instead of leaving it in bank accounts.

One fund manager showed that for every CHF 10 m. in pension money, his fund would save CHF 25,000 – in spite of the costs involved in vault rent, cash transportation and other expenses.

However, as our research team has found out, there is one bank that refuses to pay out money in such large amounts. The editorial team has gotten hold of a letter from a large Swiss bank in which it tells its customer, a pension fund:

“We are sorry, that within the time period specified, no solution corresponding to your expectations could be found.”

Bank expert Hans Geiger says that this “is most definitely not legal”. The pension fund has a sight account, and has the contractual right to dispose of its money on demand.

read more

 

And this is just a glimpse of our future - our money is not our money any more

 
morro:
And this is just a glimpse of our future - our money is not our money any more

Is it our now?

It is the same old story - when they want they can take it

 
whisperer:
Is it our now? It is the same old story - when they want they can take it

Now we at least have pillows

Soon we are going to be without them

 

Isn't what FED did (and does) worse than what SB did?

FED is puling our leg for months. SNB did it in one day and that was it

 

Saxo Bank sue customers over SNB losses

Saxo Bank A/S, a Danish broker bank stung by losses on Switzerland’s surprise revaluation of the Swiss franc, sued 12 currency-trading clients in Singapore in the latest lawsuits stemming from January’s exchange-rate turmoil.

The customers are liable for their losing trades, Saxo’s Singapore unit said in lawsuits last month, seeking $7.62 million in total. The clients countersued, saying their losses were caused by Saxo Capital Markets Pte’s arbitrary and retrospective repricing of trades, according to a joint complaint filed in the Singapore High Court.

Saxo was left with a capital hole after losing as much as $107 million when the Swiss National Bank abandoned its exchange-rate cap on the franc in January. The Singapore cases may soon be followed by others, as brokers and clients attempt to recoup losses from the Swiss move, which sent shockwaves across global markets. Another forex broker Swissquote Group Holding SA said this month it planned to take legal action against clients who haven’t repaid borrowed money they lost.

Kasper Elbjorn, a Copenhagen-based Saxo Bank spokesman declined to comment on the lawsuits, as did Shem Khoo, a lawyer representing the group of investors in Singapore. A closed hearing is scheduled for June 2.

Saxo closed some client trades after shortfalls in their accounts and continued filling orders even as the market froze after the the Jan. 15 free float of the franc. The broker warned that the “exceptional market movement” in franc trades could be revised to a worse rate, according to e-mails reproduced in Singapore court papers.

Faulty Prices

The Singapore clients claimed Saxo wrongfully deducted funds from their accounts and sold assets after the price revisions, which didn’t reflect market rates. They’re asking the court to declare that Saxo shouldn’t have retroactively repriced the trades. They’re also seeking damages for the alleged breach.

Saxo said it was contractually allowed to correct “faulty” prices. It has told the Danish regulator it was trying to avoid being sued when it continued accepting Swiss franc orders after the franc float.

The Swiss franc soared as much as 41 percent against the euro on Jan. 15 in one of the biggest moves among major currencies since the collapse of the Bretton Woods system in 1971.

Marc Buerki, chief executive of Gland, Switzerland-based Swissquote, said in a May 15 interview that the company has been in touch with about two-thirds of the 420 clients who lost money on Jan. 15 to discuss repayment and expects to take action against the remaining third.

Citibank N.A. sued a two man foreign-exchange trading team in Manhattan in March seeking to recoup $25 million. Saxo had already been threatened with litigation by customers over its repricing of the franc trades.

The cases include Saxo Capital Markets Pte Ltd. v Tey Vincent, S373/2015 and Tay Lip Sing v Saxo Capital Markets Pte Ltd. S403/2015. Singapore High Court.

source

 

SNB's Jordan - Swiss National Bank will intervene if required

Swiss National Bank's Chair Thomas Jordan, in an article in Sunday's Schweiz am Sonntag (a Swiss newspaper) says the bank is ready to intervene if the FX market, if required:
"The franc is significantly overvalued and should therefore weaken over time. In addition, we have emphasized we will become active in foreign exchange markets if required"
Via Reuters.

Bloomberg adds:

"Whether we need to go lower with the negative rates depends on international developments

"At minus 0.75 percent we've already gone quite far and we're waiting to assess the effect"

He added that Europe and the U.S. have probably reached the lower bound of interest rates

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