(SNB) Central bank measures to address elevated pressures in short term funding markets

Statement of the G10 central banks

Since the co-ordinated actions taken in December 2007, the G10 central banks have continued to work together closely and to consult regularly on liquidity pressures in funding markets. Pressures in some of these markets have recently increased again. We all continue to work together and will take appropriate steps to address those liquidity pressures.

To that end, today the Bank of Canada, the Bank of England, the European Central Bank (ECB), the Federal Reserve, and the Swiss National Bank are announcing specific measures.

Swiss National Bank action

The Swiss National Bank (SNB) has decided, in conjunction with the Federal Reserve, to resume the US dollar repo auctions it conducted in December 2007 and January 2008. This measure facilitates the US dollar funding of SNB counterparties in the Swiss repo system. The SNB intends to continue the provision of US dollar liquidity for as long as it deems necessary.

The SNB will conduct the next US dollar auction on 25 March 2008 with settlement on 27 March 2008. The maximum amount offered will be USD 6 billion. The US dollar repo auction against SNB-eligible collateral will be conducted in the form of a variable rate tender auction and will provide funds for 28 days. Further information about the US dollar auction and the technical requirements of the auction will be posted on the SNB website (http://www.snb.ch, Financial markets / Monetary operations / Repos).