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SNB's Hildebrand says will enforce franc cap

Sep 24, 2011, 2:21 p.m.
Swiss National Bank (SNB) Chairman Philipp Hildebrand speaks to the Swiss National TV during an statement in the SNB building in Bern September 6, 2011. REUTERS/Peter Schneider/Pool

WASHINGTON (Reuters) - Swiss National Bank Chairman Philipp Hildebrand said on Saturday he would do all that is necessary to maintain a ceiling on the Swiss franc, but declined to provide further details.

"We will enforce the exchange rate cap with all consequences," he said in response to questions on the sidelines of a conference at meetings of the World Bank and the International Monetary Fund.

Hildebrand would not discuss whether the SNB has plans to strengthen the cap and what resources it will bring to bear to defend it.

"With regard to how, when, and how much, we won't have any comment," he said.

The Swiss central bank earlier this month shocked financial markets by setting an exchange rate limit on the soaring franc to stave off a recession. The SNB, in unusually direct language for any central bank, said it would not tolerate an exchange rate below 1.20 francs to the euro and would defend the target by buying other currencies in unlimited quantities.

Commenting on the resignation of the chief executive of embattled Swiss bank UBS , Hildebrand said Oswald Gruebel deserved credit for returning the institution to profitability.

"For those efforts, he deserves a lot of credit," Hildebrand said. "The rest is a decision that he took, in discussions as I imagine between the board and his colleagues," he said.

( Reporting by Mark Felsenthal, Editing by Chizu Nomiyama)

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