news conference berne, 15 december 2016 thomas jordan introductory remarks by thomas jordan ladies and gentlemen it is a pleasure for me to welcome you to the swiss national bank ’ s news conference. i will begin by explaining our monetary policy decision and our assessment of the economic situation. i will then hand over to fritz zurbrugg, who will speak about current developments in the area of financial stability and announce the dates for the release of the new 20 - franc banknote. after that, andrea maechler will review the situation on the financial markets and discuss the impact of negative interest on the money and capital markets. finally, we will – as ever – be pleased to take your questions. monetary policy decision let me begin with our monetary policy decision and the inflation forecast. our monetary policy remains expansionary and continues to be based on two elements : the negative interest rate and our willingness to intervene in the foreign exchange market. we are leaving interest on sight deposits at the snb at – 0. 75 % and the target range for the threemonth libor will remain unchanged at between – 1. 25 % and – 0. 25 %. at the same time, we will remain active in the foreign exchange market as necessary, while taking the overall currency situation into consideration. the snb ’ s expansionary monetary policy is aimed at stabilising price developments and supporting economic activity. the negative interest rate and our willingness to intervene in the foreign exchange market are intended to make swiss franc investments less attractive, thereby easing pressure on the currency. the swiss franc is still significantly overvalued. compared to september, the new conditional inflation forecast has been revised slightly downwards in the short term. this mainly reflects the fact that inflation in october and page 1 / 5 berne, 15 december 2016 thomas jordan news conference november was somewhat lower than expected. however, our expectations for the mediumterm development of inflation remain essentially unchanged. we continue to anticipate an inflation rate of – 0. 4 % for the current year. for 2017, the inflation forecast is down to 0. 1 %, from 0. 2 % in the previous quarter. for 2018, we now expect inflation of 0. 5 %, compared to 0. 6 % in the third quarter. the conditional inflation forecast is based on the assumption that the three - month libor remains at – 0. 75 % over the entire forecast horizon. global economic outlook i would now like to turn to economic developments abroad, as

carlos da silva costa : increasing the resilience of the portuguese financial system opening address by mr carlos da silva costa, governor of the bank of portugal, to the cofap committee regarding banco espirito santo, lisbon, 18 july 2014. * i. * * background on supervisory activity since 2011 to increase the resilience of the portuguese financial system, banco de portugal designed an action plan which began before the economic and financial assistance programme and continued under that programme and thereafter, involving the following horizontal exercises : • the special inspections programme ( sip ), launched in 2011, which aimed at validating the key components for calculating institutions ’ solvency levels by analysing three aspects ( review of impairment, rwa calculation and stress test methodology ) ; • the on - site inspections programme ( oip ), conducted in 2012, which aimed at validating impairment levels for exposures in specific sectors deemed high - risk ; • the horizontal review of credit portfolio impairment ( etricc ) in 2013, which assessed individual impairment in the credit portfolio, and was followed by a second phase ( etricc 2 ), which assessed impairment from exposures to 12 economic groups selected using risk criteria ; • finally, also in 2013, the special assessment programme ( sap ), which assessed the institutions ’ procedures and processes in managing distressed credit. the results of the sip were disclosed in a press release on 16 december 2011. the credit assessment estimated that eur 838 million was needed to reach robust impairment levels for the set of eight banking groups as at 30 june 2011. this corresponded to 9. 1 % of total impairment constituted for credit covered by the inspection work and 0. 3 % of the overall amount of this credit. all the banking groups strengthened their impairment levels in accordance with banco de portugal ’ s request. the sip followed an innovative methodology in terms of supervision, simultaneously covering the eight major banking groups ( over 80 % of the assets and credit in the financial system ) and used independent audit firms that assessed the credit portfolio against benchmarks defined by banco de portugal. despite the complexity and wide scope of the exercise, which involved a significant number of human resources ( 350 people, including auditors, consultants and banco de portugal staff ) and a very demanding timeframe, the internal governance mechanisms adopted by banco de portugal led to timeliness, quality and consistency in the results. a steering committee was set up to monitor execution of the programme, chaired by banco de portugal and comprised of experts designated by the international