2014 International Monetary Fund, Publication Services


2014 International Monetary Fund, Publication Services

P.O. Box 92780

Washington, D.C. 20090, U.S.A.

(202) 623-7430

(202) 623-7201








2014 Previously published as Financial Organization and Operations of the IMF First edition 1986; Sixth edition 2001

Cataloging-in-Publication Data

Joint Bank-Fund Library

IMF Financial operations / Finance Department, International Monetary

Fund. – Washington, D.C. : International Monetary Fund, 2014

p. ; cm.

Includes bibliographical references.

1. International Monetary Fund. 2. International finance. 3. Financial organization and operations of the IMF. I. International Monetary Fund. Finance Department.

HG3881.5.I58 F48 2014


  • Preface

  • Acknowledgments

  • Abbreviations

  • 1. Overview of the IMF as a Financial Institution

    • 1.1 Role and Purposes of the IMF

    • 1.2 Evolution of the IMF’s Financial Structure

    • 1.3 Measures Taken since the Onset of the Financial Crisis

      • 1.3.1 Borrowing

      • 1.3.2 Quotas

      • 1.3.3 SDRs

      • 1.3.4 General Lending Framework

      • 1.3.5 Resources and Lending to Low-Income Countries

    • 1.4 The IMF’s Financial Structure and Lending Mechanisms

      • 1.4.1 Nonconcessional Financing (Chapter 2)

      • 1.4.2 Concessional Financing (Chapter 3)

      • 1.4.3 The SDR (Chapter 4)

      • 1.4.4 Income Generation (Chapter 5)

      • 1.4.5 Financial Risk Management (Chapter 6)

    • 1.5 Information Sources on IMF Finances

      • 1.5.1 IMF Website

      • 1.5.2 Contacts in the Finance Department

    • Additional Reading

  • 2. Nonconcessional Financial Operations

    • 2.1 Financing Nonconcessional Lending Operations: Resources and Liabilities

      • 2.1.1 Quotas

      • 2.1.2 The Quota Formula

      • 2.1.3 Quota Increases under General Reviews

      • 2.1.4 Ad Hoc Quota Increases

      • 2.1.5 Recent Quota, Voice, and Governance Reforms

      • 2.1.6 Borrowing by the IMF

    • 2.2 The IMF’s Financing Mechanism

      • 2.2.1 The Financial Transactions Plan

      • 2.2.2 NAB Resource Mobilization Plan

    • 2.3 The Asset Side

      • 2.3.1 Financial Policies and Facilities: The GRA Lending Toolkit

      • 2.3.2 Credit Outstanding

      • 2.3.3 Gold Holdings

    • 2.4 The IMF’s Balance Sheet and Income Statement

      • 2.4.1 The Balance Sheet

      • 2.4.2 Operational Income

      • 2.4.3 Operational Expenses

      • 2.4.4 Administrative Expenses

      • 2.4.5 Net Income

      • 2.4.6 Valuation of Currencies

    • 2.5 Special Disbursement Account

    • 2.6 IMF Accounts in Member Countries

      • 2.6.1 Disclosure of Financial Position with the IMF by Member Countries

    • Additional Reading

  • 3. Financial Assistance for Low-Income Countries

    • 3.1 The Evolution of Concessional Lending

    • 3.2 Poverty Reduction and Growth Trust

      • 3.2.1 PRGT Terms

      • 3.2.2 PRGT Eligibility

    • 3.3 Heavily Indebted Poor Countries Initiative

      • 3.3.1 HIPC Eligibility and Qualification Criteria

      • 3.3.2 Provision of Debt Relief

    • 3.4 Multilateral Debt Relief Initiative

    • 3.5 Post-Catastrophe Debt Relief Trust

    • 3.6 Financing Concessional Assistance and Debt Relief

      • 3.6.1 Financing Structure

      • 3.6.2 Framework for Concessional Lending

      • 3.6.3 Resources for Concessional Lending

      • 3.6.4 Self-Sustained PRGT

      • 3.6.5 Framework for Debt Relief

      • 3.6.6 Resources for Debt Relief

    • Additional Reading

  • 4. Special Drawing Rights

    • 4.1 Background and Characteristics of the SDR

    • 4.2 Valuation of the SDR

      • 4.2.1 SDR Basket

      • 4.2.2 Current SDR Valuation Method

    • 4.3 The SDR Interest Rate

    • 4.4 Allocations and Cancellations of SDRs

    • 4.5 Operation of the SDR Department

      • 4.5.1 Participants and Prescribed Holders

      • 4.5.2 Flows of SDRs and the Central Role of the IMF

      • 4.5.3 IMF SDR Holdings

      • 4.5.4 Voluntary SDR Trading Arrangements

    • 4.6 Financial Statements of the SDR Department

    • Additional Reading

  • 5. The IMF’s Income Model

    • 5.1 Lending Income

    • 5.2 The New Income Model

      • 5.2.1 Features of the New Income Model

    • 5.3 Investment Income

      • 5.3.1 Subaccounts

      • 5.3.2 The Use of Investment Income

    • 5.4 Reimbursements to the General Resources Account

    • Additional Reading

  • 6. Financial Risk Management

    • 6.1 Financial Risk: Sources and Mitigation Framework

      • 6.1.1 Credit Risks

      • 6.1.2 Liquidity Risks

      • 6.1.3 Income Risk

    • 6.2 Overdue Financial Obligations

      • 6.2.1 Overview

      • 6.2.2 Cooperative Strategy on Overdue Financial Obligations

      • 6.2.3 Arrears Clearance Modalities

      • 6.2.4 Special Charges

    • 6.3 Safeguards Assessments of Central Banks

      • 6.3.1 History and Objectives

      • 6.3.2 Conceptual Framework: Governance and Controls

      • 6.3.3 Modalities

      • 6.3.4 Safeguard Risks beyond Central Banks

    • 6.4 Audit Framework

    • 6.5 Financial Reporting and Risk Disclosure

    • Additional Reading

  • Appendix 1 IMF Membership: Quotas, and Allocations and Holdings of SDRs (Millions of SDRs and percent; as of April 30, 2014)

  • Appendix 2 Special Voting Majorities for Selected Financial Decisions

  • Appendix 3 Other Administered Accounts

  • Appendix 4 Disclosure of Financial Position with the IMF in the Balance Sheet of a Member’s Central Bank

  • Glossary

  • Index

  • Figures

    • 2.1 The Size of the IMF

    • 2.2 The IMF Lending Mechanism: An Exchange of Assets

    • 2.3 Members’ Financial Positions in the General Resources Account

    • 2.4 Outstanding IMF Credit by Facility, 1990–

    • 2.5 Median and Interquartile Range for Annual Average Access under Stand-By and Extended Arrangements

    • 2.6 Distribution of Annual Access under General Resources Account Arrangements, 1990–

    • 3.1 PRGT-Eligible Countries: GRA Purchases and Concessional Loan Disbursements, 1987–

    • 3.2 Outstanding Concessional Credit by Facility, 1976–

    • 3.3 IMF Debt Relief to Low-Income Countries, 1998–

    • 3.4 Concessional Financing Framework

    • 3.5 Flow of Funds in the Poverty Reduction and Growth Trust

    • 3.6 Poverty Reduction and Growth Trust Reserve Account Coverage, 1998–

    • 3.7 Debt Relief Framework

    • 3.8 Financial Structure of the Poverty Reduction and Growth—Heavily Indebted Poor Countries Trust

    • 3.9 Financing Framework for Debt Relief under the Heavily Indebted Poor Countries Initiative and Multilateral Debt Relief Initiative

    • 4.1 Actual Currency Weights in the SDR Basket, 2000–

    • 4.2 Interest Rates on the SDR and Its Financial Instrument Components, 2005–

    • 4.3 Circulation of SDRs

    • 4.4 Selected SDR Transactions, 2004–

    • 4.5 IMF SDR Holdings, 2004–14

    • 4.6 SDR Sales: Participation by Market Makers by Region, September 1, 2009–April 30,

    • 5.1 Snapshot of the IMF Income Statement

    • 5.2 Weekly Interest Rates and Margins, 2004–

    • 5.3 The New Income Model

    • 5.4 Earnings of the Investment Account

    • 6.1 Forward Commitment Capacity: How the IMF Augments Quota Resources through Borrowing, December 1994–March

    • 6.2 Overdue Financial Obligations to the IMF, 1980–

    • 6.3 IMF Credit Outstanding and Overdue Obligations, 1984–

    • 6.4 Safeguards Analytical Framework and Governance Focus

    • 6.5 Safeguard Assessments by Region

  • Tables

    • 2.1 General Reviews of Quotas

    • 2.2 Agreed Changes in IMF Quotas

    • 2.3 Countries that Have Received Ad Hoc Quota Increases Agreed under the 2008 Quota and Voice Reforms

    • 2.4 General and New Arrangements to Borrow

    • 2.5 Financial Terms under IMF General Resources Account Credit

    • 2.6 Balance Sheet of the General Department

    • 2.7 Income Statement of the General Department

    • 3.1 Concessional Lending Facilities

    • 3.2 Access Limits and Norms for Poverty Reduction and Growth Trust Facility

    • 3.3 Countries Eligible for the Poverty Reduction and Growth Trust and the Heavily Indebted Poor Countries Initiative

    • 3.4 HIPC Thresholds for the Present Value of External Debt

    • 3.5 Implementation of the HIPC Initiative

    • 3.6 PRG-HIPC Financing Requirements and Sources

    • 3.7 Debt Relief Following Implementation of the Multilateral Debt Relief Initiative

    • 3.8 Cumulative Commitments of Lenders to the Poverty Reduction and Growth Trust

    • 3.9 Heavily Indebted Poor Countries and Poverty Reduction and Growth–HIPC Trust Resources

    • 3.10 MDRI Trust Debt Relief and Sources of Financing

    • 3.11 PCDR Trust Debt Relief and Sources of Financing

    • 4.1 Currency Weights in the SDR Basket

    • 4.2 Balance Sheet of the SDR Department

    • 4.3 Income Statement of the SDR Department

    • 5.1 Investment Account Subaccounts

    • 6.1 Level of Precautionary Balances in the General Resources Account

    • 6.2 The IMF’s Liquidity, 2009–

    • 6.3 History of Protracted Arrears to the IMF

    • 6.4 Arrears to the IMF of Countries with Obligations Overdue by Six Months or More by Type and Duration

  • Boxes

    • 1.1 Decision-Making Structure of the IMF

    • 1.2 Financial Structure of the IMF

    • 2.1 The General Department’s Balance Sheet Snapshot

    • 2.2 Quota Payment Procedures

    • 2.3 The Quota Formula

    • 2.4 The Reserve Tranche Position

    • 2.5 The Evolution of Conditionality

    • 2.6 Key Gold Transactions

    • 3.1 Concessional Lending Timeline

    • 3.2 Subsidization of Emergency Assistance and Its Financing

    • 3.3 Exogenous Shocks Facility

    • 3.4 Policy Support Instrument

    • 3.5 Interest Rate Regime for Concessional Facilities

    • 3.6 Poverty Reduction Strategy Papers

    • 3.7 Debt Relief Timeline

    • 3.8 The Heavily Indebted Poor Countries Sunset Clause

    • 3.9 Topping Up HIPC Assistance

    • 3.10 Liberia’s Debt Relief

    • 3.11 Trust Assets: Investments in Support of Concessional Financing

    • 3.12 The 2009 Fundraising Exercise

    • 3.13 Features of Loan Resources

    • 3.14 Reimbursement of Administrative Expenses Associated with Concessional Lending Operations

    • 3.15 Making the Poverty Reduction and Growth Trust Sustainable

    • 4.1 Creation of the SDR

    • 4.2 Broad Principles Guiding SDR Valuation Decisions

    • 4.3 Criteria for the Composition of the SDR Basket

    • 4.4 Currency Amounts and Actual Daily Weights

    • 4.5 SDR Interest Rate Calculation

    • 4.6 Borrowing SDRs for Payment of the Reserve Asset Portion of a Quota Increase

    • 4.7 Voluntary Trading Arrangements of Special Drawing Rights

    • 4.8 Timeline to Buy or Sell SDRs under the Voluntary Trading Arrangements

    • 4.9 Designation Mechanism

    • 5.1 Setting the Margin for the Basic Rate of Charge

    • 5.2 Evolution of Surcharges

    • 5.3 Commitment Fees

    • 5.4 Committee of Eminent Persons’ Proposal for Increasing IMF Income

    • 5.5 Reimbursement to the General Resources Account from the Poverty Reduction and Growth Trust

    • 6.1 Financial Risks Faced by the IMF: Sources and Mitigation

    • 6.2 The Burden-Sharing Mechanism: Capacity and Implications for Arrears

    • 6.3 Composition of the IMF’s Precautionary Balances

    • 6.4 International Financial Reporting Standards

    • 6.5 The Forward Commitment Capacity

    • 6.6 Overdue Financial Obligations to the IMF

    • 6.7 Overdue Financial Obligations to the General Department and the SDR Department: Timetable of Remedial Measures

    • 6.8 Overdue Financial Obligations to the Poverty Reduction and Growth Trust: Timetable of Remedial Measures

    • 6.9 The IMF’s Safeguards Assessments Policy

    • 6.10 Misreporting Framework

    • 6.11 The IMF’s External Audit Arrangements


The International Monetary Fund was conceived in July 1944, at a United Nations conference in Bretton Woods, New Hampshire, United States. The 44 participating governments sought to build a framework for economic cooperation that would forestall any repetition of the disastrous policies, including competitive devaluations, that contributed to the Great Depression of the 1930s and, ultimately, to World War II.

The IMF now has 188 member countries and has evolved over time as the global economy has expanded, become more integrated, and endured both boom and bust. But the IMF’s mission has remained the same: to ensure the stability of the international monetary system—the system of exchange rates and international payments that enables countries (and their citizens) to transact with one other and that is essential for promoting sustainable economic growth, increasing living standards, and reducing poverty.

This publication provides a broad introduction to how the IMF fulfills this mission through its financial activities. It covers the financial structure and operations of the IMF and also provides background detail of the financial statements for the IMF’s activities during the most recent financial year. Making such financial information publicly available is part of the IMF’s overarching commitment to transparency. Transparency in economic policy and the availability of reliable data on economic and financial developments is critical for sound decision-making and for the smooth functioning of the international economy. Toward that end, this publication also contains numerous links to other publicly available information on IMF finances, including on the IMF’s website, www.imf.org.

Chapter 1 reviews the evolution of the IMF’s financial structure and operations, its role and functions, governance structure, and the nature of recent reforms. Chapters 2 and 3 explain how the IMF provides lending to member countries experiencing actual or potential balance of payments problems, meaning that the country cannot find sufficient financing on affordable terms to meet its net international payments (for example, for imports or external debt redemptions). This financial assistance enables countries to rebuild their international reserves, stabilize their currencies, continue paying for imports, and restore conditions for strong economic growth, while undertaking policies to correct underlying problems. Chapter 2 reviews IMF lending made at market rates (that is, nonconcessional lending facilities), and Chapter 3 describes the various concessional facilities by which the IMF lends to low-income member countries at favorable rates (currently, a zero interest rate).

Chapter 4 reviews the SDR mechanism; Chapter 5 outlines the sources of income for the IMF; and Chapter 6 outlines the institution’s approach to financial risk management. The publication also includes a list of common abbreviations, a glossary, and an index.

What’s New

This publication updates a previous report entitled Financial Organization and Operations of the IMF, first published in 1986 and last issued in 2001 (the sixth edition). That 2001 report reflected the seismic shifts in the global economy and in the IMF’s structure and operations that occurred after the fall of the Soviet Union and the various currency and financial crises of the 1990s. This revised and updated report covers more recent developments, including reform of the IMF’s income model, measures taken in response to the global financial crisis of 2007–09, and the institutional reforms aimed at ensuring that the IMF’s governance structure evolves in line with developments in the global economy.

The IMF significantly bolstered its lending capacity in the wake of the global financial crisis. This was done to meet the unprecedented financing needs of a number of countries hit hard by the crisis and to help strengthen global economic and financial stability. IMF lending capacity was expanded several ways, including through borrowing, completion of a general quota review that resulted in an agreement to double its quota resources, and implementation of two SDR allocations. Moreover, the IMF refined its general lending framework to better meet member country needs and, in particular, to emphasize measures to prevent crises in the future.

The IMF also reformed its policies toward low-income countries and significantly increased the resources available to the world’s poorest countries. In November 2010, IMF member countries agreed to a historic governance reform that creates a more representative, all elected Executive Board and increases the voting power of emerging market and developing economies, while simultaneously preserving the voice of the low-income members.

How to Use This Document

This publication includes descriptions of the IMF’s financial organization, its policies and lending arrangements, and details on its financial statements. These are meant only to explain and synthesize official IMF documents, records, and agreements. For authoritative versions of these materials, readers should directly consult the official institutional records, which are available at www.imf.org/external/fin.htm.1

Digital technology and the Internet make it easier to create and distribute this type of compendium in multiple formats and also to keep it up to date. This publication will be updated on an annual basis, and in line with the IMF’s financial year on April 30, and it will be available in multiple digital and print formats, including print copies, PDF files available for online viewing and print-on-demand, and formats for eReaders (eBook, iBook, Mobi, Kindle, Nook, and more).2 We will update individual chapters more regularly if there are significant changes to IMF structures or lending facilities or if we uncover errors in the published edition. These updates will be available online and will note the date of the last revision. The version of record will be the latest electronic version published on the IMF’s website and eLibrary.

We invite your feedback and comments. This publication is meant to answer your questions about the IMF. If some of your questions remain unanswered, please contact us at publicaffairs@imf.org.

Andrew Tweedie

Director, Finance Department


This publication was prepared by staff members of the Finance Department under the direction of Susan Prowse, Advisor. Principal contributors include Elena Budras, Lia Cruz, Joanna Grochalska, Curtis Hatch, Lodewyk Erasmus, Lukas Kohler, Sergio Rodriguez, and Fang Yang. Christine Kadama was the project manager for this publication and also provided outstanding research and information technology support. Yanaisse Arica, Corinne Danklou, and Vanessa Ince provided exceptional administrative support for the project. From the IMF Communications Department, Linda Griffin Kean led the editorial effort and managed production of this publication. In addition, valuable contributions were provided by Mariel Acosta, Alexander Attie, Preet Bhullar, Veerayudh Bunsoong, Andrei Galatanu, Chris Geiregat, Ivetta Hakobyan, Heikki Hatanpaa, Mary Hoare, Hideaki Imamura, Paul Jenkins, Jane Mburu, Maria Mendez, Diviesh Nana, Patrick Njoroge, Breno Oliveira, Andres Perez, Robert Powell, John Ralyea, Tracey Redfern, Rachel Saperstein, Mariusz Sumlinski, and Barry Yuen. Comments and suggestions were also received from other departments in the IMF, including the Legal and Strategy, Policy, and Review Departments.

IMF Financial Operations provides a summary of financial operations and policies of the International Monetary Fund. It represents a thorough updating of a previous report entitled Financial Organization and Operations of the IMF, first published in 1986 and last issued in 2001. Many descriptions have been simplified in a reader-friendly manner and should not be treated as authoritative statements on IMF policies. The views expressed in this publication are those of IMF staff and do not necessarily represent the views of the Executive Board or their national authorities.



Bank for International Settlements


Balance of Payments Manual, sixth edition


Committee of Eminent Persons


External Audit Committee


Extended Credit Facility


Extended Fund Facility


Emergency Natural Disaster Assistance


Emergency Post Conflict Assistance


Enhanced Structural Adjustment Facility


Exogenous Shocks Facility


Forward Commitment Capacity


Flexible Credit Line


Financial Sector Assessment Program


Financial Transactions Plan


Financial Year


General Arrangements to Borrow


Group of Twenty


Gross Domestic Product


Global Financial Stability Report


General Loan Account


General Resources Account


General Subsidy Account


High Access Precautionary Arrangement


Heavily Indebted Poor Countries


Investment Account


International Development Association


International Financial Institution


International Financial Reporting Standards


International Financial Statistics


International Monetary Fund


International Monetary and Financial Committee


Low-Income Country


Multilateral Debt Relief Initiative


New Arrangements to Borrow


Net Present Value


Organization for Economic Cooperation and Development


Organization of Petroleum Exporting Countries


Post-Catastrophe Debt Relief


Precautionary and Liquidity Line


Purchase Power Parity


Poverty Reduction and Growth Trust


Poverty Reduction Strategy Paper


Policy Support Instrument


Quantitative Performance Criteria


Reserve Account


Rights Accumulation Program


Rapid Credit Facility


Real Estate Investment Trust


Rapid Financing Instrument


Resource Mobilization Plan


Stand-By Arrangement


Special Contingent Account


Standby Credit Facility


Special Disbursement Account


Special Drawing Right


Staff Monitored Program


Special Subsidy Account


Time-Based Repurchase Expectation Policy


Trust Fund


Trade Integration Mechanism


Technical Memorandum of Understanding


Upper-Credit Tranche


Voluntary Trading Arrangements

The following symbols have been used throughout this publication:

. . . to indicate that data are not available

— to indicate that the figure is zero or less than half the final digit shown, or that the item does not exist

– between years or months (for example, 2012–13 or January–June) to indicate the years or months covered, including the beginning and ending years or months

/ between years (for example, 2012/13) to indicate a fiscal or financial year

“Billion” means a thousand million; “trillion” means a thousand billion.

“Basis points” refer to hundredths of 1 percentage point (for example, 25 basis points are equivalent to ¼ of 1 percentage point).

FY refers to the IMF’s financial year (May 1–April 30) unless otherwise noted.

“n.a.” means “not applicable.”

Minor discrepancies between sums of constituent figures and totals are due to rounding.

As used in this publication, the term “country” does not in all cases refer to a territorial entity that is a state as understood by international law and practice. As used here, the term also covers some territorial entities that are not states but for which statistical data are maintained on a separate and independent basis.


In addition, a complete archive of the Annual Reports issued by the Executive Board is available on the IMF eLibrary at www.elibrary.imf.org.


For web PDF files, visit www.imf.org; for other digital formats, visit www.elibrary.imf.org.