Swiss central bankers used loans provided by the New York Federal Reserve to buy loans from UBS, the Swiss banking giant, according to a report from the Government Accounting Office.
The loans were made through a swap agreement that had long been in place to allow Switzerland to provide liquidity to institutions facing dollar funding strains. Several other countries have similar agreements with the Federal Reserve Bank of New York.
But the Swiss National Bank used the swap lines in a very unusual way.
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