The Switzerland Central Bank said it recorded a loss of over three billion Swiss francs or $3.5bn last year on the back of its interest rate hikes.

The loss, as reported by the AFP on Tuesday, means the country’s government and cantons will not receive their annual pay-out from the Swiss National Bank for a second year in a row.

“Like other central banks worldwide, the SNB has raised its interest rates out of negative territory to tame inflation.

“This meant that the SNB had to pay interest to banks parking their money at the central bank,” the bank said.

The SNB said, “It had a loss of 8.5 billion francs on national currency positions last year. It made a profit of four billion francs on foreign currency positions.

“Its gold holdings recorded a valuation gain of 1.7 billion francs.