Swiss central bank head resigns after scandal

The embattled head of the Swiss central bank, Philipp Hildebrand, announced his immediate resignation on Monday after being caught up in a scandal over foreign exchange trades by his wife. At a news conference Hildebrand made public documents showing that his wife had made foreign currency trades that a Swiss weekly had accused him of making.
Last week Hildebrand had rejected criticism of foreign currency transactions by his family last year, refusing to step down and suggesting "political motives" were at work. Press reports claimed last week that Hildebrand's wife Kashya profited after buying $504,000 (396,000 euros) last August just weeks before an intervention by the SNB to halt the rise of the franc - a move that saw the dollar rise significantly against the Swiss currency.
The scandal took a political turn with revelations that the government last month received banking documents concerning Hildebrand's personal trades from Christoph Blocher, chief of the conservative Swiss People's Party (UDC), the largest in the Federal Assembly.
The Swiss weekly Weltwoche, close to the UDC, said the controversial currency trades were made by Hildebrand and not by his wife without his knowledge, as the central bank had indicated. When he spoke publicly for the first time about the scandal, Hildebrand said he had complied with all the regulations of the central bank but conceded he had made mistakes and that banking transparency would need to be tightened.
"I acted correctly on every count," he said Thursday following days of speculation over allegations of insider trading on a dollar trade his wife made in August three weeks before the Swiss National Bank put a floor on the Swiss franc at 1.20 euros. "So long as I have the confidence of the government and the bank council, stepping down is not an issue for me," Hildebrand had said.
"Looking back I made mistakes," he conceded, saying he could have reversed his wife's decision. After the resignation, the SNB said it will continue to defend "with the utmost determination" the exchange rate floor of 1.20 francs a euro. "The current monetary policy on the NBS exchange rate of a minimum of 1.20 francs a euro remains unchanged," the central bank said in a statement, adding it "regretted the decision and the circumstances" that led to Philipp Hildebrand to step down as chairman. Hildebrand's announcement came despite backing at the weekend from Swiss President Eveline Widmer-Schlumpf who said he should not resign. "We would lose a (central bank) president who has undisputedly done excellent work, has a good network, and could be very useful to Switzerland," said Widmer-Schlumpf, who is also finance minister, on Swiss television.