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SNB Launches Covid-19 Refinancing Facility To Combat Coronavirus Crisis

The Swiss National Bank introduced a COVID-19 refinancing facility to support liquidity to offset the economic impact of the coronavirus outbreak.

The COVID-19 refinancing facility, or CRF, is aimed at strengthening the supply of credit to the Swiss economy by providing the banking system with additional liquidity, the SNB said in a statement on Wednesday.

The interest rate for these refinancing transactions corresponded to the SNB policy rate. The CRF will be available from March 26.

There will be no upper limit on the amounts available under the CRF and drawdowns could be made at any time, the bank said.

The facility will allow banks to obtain liquidity from the SNB, which is secured by the federally guaranteed loans.

In order to further facilitate lending, the SNB has also submitted a proposal to the Federal Council to reduce the countercyclical capital buffer to 0% with immediate effect.

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