Philipp Michael Hildebrand (born 19 July 1963) is a Swiss banker who has been serving as a vice chairman of BlackRock since 2012.
Hildebrand was the head of the Swiss central bank, the Swiss National Bank (SNB), from 2010 until he resigned on 9 January 2012 after controversy surrounding his wife's currency trading. He had been a member of the central bank's governing board since 2003.
Early life and education
Hildebrand attended the University of Toronto, Oxford University's Lincoln College, and the Graduate Institute of International Studies in Geneva. He was part of a group of students that helped out during the Annual Meetings of the World Economic Forum in Davos, Switzerland. There, he met leading international government officials and bankers.
Career in the private sector
In 1994 Hildebrand began his professional career at WEF. He subsequently worked at Moore Capital Management, a hedge fund in New York and London, where he met his wife. He then worked as head of hedge funds for Union Bancaire Privée in Geneva and Vontobel in Zurich.
Career at the SNB
Hildebrand was said to be the "youngest ever policy maker" when he joined the SNB in 2003.
Prior to his resignation from the SNB, Hildebrand was a member of the board of directors of the Bank for International Settlements in Basel, as well as vice-chairman of the Financial Stability Board. From 2008, he was a member of the Group of Thirty.
Controversy around the 2009/2010 exchange rate interventions
Hildebrand was attacked after losses arising from SNB's exchange rate interventions between March 2009 and June 2010. In this period, the SNB accumulated foreign currency reserves worth over 200 billion Swiss francs (Codes: CHF, SFr). As the Swiss franc has appreciated, the interventions caused losses on SNB foreign currency positions equivalent to 26.5 billion Swiss francs in 2010 and 11.7 billion Swiss francs in the first six months of 2011. The SNB has defended these interventions as they made “sense at the zero lower bound when the traditional monetary policy instrument is exhausted”. Some international press and financial market analysts considered the interventions a “costly failure”.
The People's Party (Schweizerische Volkspartei (SVP) / Union Démocratique du Centre (UDC)) and the magazine Weltwoche were critics of Hildebrand, demanding his resignation. Prominent figures of other parties supported Hildebrand and emphasized the political independence of the SNB. In an article titled “With Unsteady Hand”, Switzerland's major business magazine Bilanz criticized Mr. Hildebrand's leadership of SNB, citing his limited experience and saying that Mr. Hildebrand's actions in large parts seem to be the result of his eagerness to appeal to the public.
Pegging of the Swiss Franc to the Euro since 6 September 2011
Hildebrand is considered a driving force behind the pegging of the Swiss Franc to the Euro announced on 6 September 2011. The central bank commits to undertake transactions to cap the value of the franc against the euro at a maximum of 1.20. In early August, the euro fell to near parity, at 1.00749, against the franc. After initial cautious reactions by analysts, the decision of the Swiss National Bank to aim to keep the Swiss Franc: Euro rate above 1.20 is considered to have been a success.
2011 personal foreign exchange trading and resignation
In August, 2011, Hildebrand's wife Kashya made a CHF 60,000 ($64,400) profit on a currency transaction. At the time, Philipp Hildebrand reported the transaction to the SNB and moved to prevent future such trades with Bank Sarasin. His wife asserted her independent finance and banking experience as the basis for the "almost ridiculously cheap" trade. In January, 2012, Hildebrand denied accusations of insider trading in relation to the transaction, resisted calls for his resignation and called the coverage "a smear campaign".
He said that his political foes endangered the secrecy laws and "the interests of Switzerland" with the accusations. "I made mistakes" in not canceling the trade, which profited from the SNB's decision to intervene in the currency markets two days later "but I always acted in line with the rules", he said.