New Arrangements to Borrow

Preamble

In order to enable the International Monetary Fund (the “Fund”) to fulfill more effectively its role in the international monetary system, a number of countries with the financial capacity to support the international monetary system have agreed to provide resources to the Fund up to specified amounts in accordance with the terms and conditions of this decision. As the Fund is a quota-based institution, the credit arrangements provided for under the terms of this decision shall only be drawn upon when quota resources need to be supplemented in order to forestall or cope with an impairment of the international monetary system. In order to give effect to these intentions, the following terms and conditions are adopted under Article VII, Section of the Fund’s Articles of Agreement.

Paragraph 1. Definitions

(a) As used in this decision the term:

• (i) “amount of a credit arrangement” means the maximum amount expressed in special drawing rights that a participant undertakes to make available to the Fund under a credit arrangement;

• (ii) “Articles” means the Articles of Agreement of the Fund;

• (iii) “available commitment” means a participant’s credit arrangement less any drawn and outstanding balances;

• (iv) “borrowed currency” or “currency borrowed” means currency transferred to the Fund’s account under a credit arrangement;

• (v) “call” means a notice by the Fund to a participant to make a transfer under its credit arrangement to the Fund’s account;

• (vi) “credit arrangement” means an undertaking to provide resources to the Fund on the terms and conditions of this decision;

• (vii) “currency actually convertible” means currency included in the Fund’s financial transactions plan for transfers;

• (viii) “drawer” means a member that purchases borrowed currency from the General Resources Account of the Fund;

• (ix) “indebtedness of the Fund” means the amount the Fund is committed to repay under a credit arrangement;

• (x) “member” means a member of the Fund;

• (xi) “participant” means a participating member or a participating institution;

• (xii) “participating institution” means an official institution of a member that has entered into a credit arrangement with the Fund with the consent of the member; and

• (xiii) “participating member” means a member that has entered into a credit arrangement with the Fund.

(b) For the purposes of this decision, the Monetary Authority of Hong Kong (the “HKMA”) shall be regarded as an official institution of the member whose territories include Hong Kong, provided that:

(i) loans by the HKMA and payments by the Fund to the HKMA under this decision shall be made in the currency of the United States of America, unless the currency of another member is agreed between the Fund and the HKMA;

(ii) the references to balance of payments and reserve position in paragraphs 5(c), 6(b), 6(c), 7(a), and 11(e) shall be understood to refer to the balance of payments and reserve position of Hong Kong. The HKMA shall not be eligible to vote on a proposal for activation under paragraph 5(c), included in a resources mobilization plan under paragraph 6(b), or subject to calls under paragraph 7(a), and shall be excluded from calls in accordance with paragraph 6(c), if, at the time of voting on any such proposal, approval of any such resource mobilization plan, or making of any such call, the HKMA notifies the Fund that Hong Kong’s present and prospective balance of payments and reserve position does not allow it to meet calls under its credit arrangement; and

(iii) the HKMA shall have the right to request early repayment in accordance with paragraph 13(c) with respect to claims transferred to the HKMA if at the time of the transfer the balance of payments position of Hong Kong is, in the opinion of the Fund, sufficiently strong to justify such a right.

Paragraph 2. Credit Arrangements

(a) A member or institution that adheres to this decision undertakes to provide resources to the Fund on the terms and conditions of this decision up to the amount in special drawing rights set forth in Annex I to this decision (“Annex I”), which may be amended from time to time in order to take into account changes in credit arrangements resulting from the application of paragraphs 3(b), 4, 15(b), 16, 17, and 19(b).

(b) Except as set forth in paragraph 1(b)(i) or otherwise agreed with the Fund, resources provided to the Fund under this decision shall be made in the currency of the participant. Agreements under this paragraph for the use of the currency of another member shall be subject to the concurrence of any member whose currency shall be used.

Paragraph 3. Adherence

(a) Any member or institution specified in Annex I as a new participant may adhere to this decision in accordance with paragraph 3(c).

(b) Any member or institution not specified in Annex I, may apply to become a participant at any time. Any such member or institution that wishes to become a participant shall, after consultation with the Fund, give notice of its willingness to adhere to this decision, and, if the Fund and participants representing 85 percent of total credit arrangements shall so agree, the member or institution may adhere in accordance with paragraph 3(c). When giving notice of its willingness to adhere under this paragraph 3(b), a member or institution shall specify the amount, expressed in special drawing rights, of the credit arrangement which it is willing to enter into, provided that the amount shall not be less than the credit arrangement of the participant with the smallest credit arrangement. The admission of a new participant shall lead to a proportional reduction in the credit arrangements of all existing participants whose credit arrangements are above that of the participant with the smallest credit arrangement: such proportional reduction in the credit arrangements of participants shall be in an aggregate amount equal to the amount of the new participant’s credit arrangement less any increase in total credit arrangements decided in accordance with paragraph 4(a), provided that no participant’s credit arrangement shall be reduced below the minimum amount set out in Annex I.

(c) A member or institution shall adhere to this decision by depositing with the Fund an instrument setting forth that it has adhered in accordance with its law and has taken all steps necessary to enable it to carry out the terms and conditions of this decision. on the deposit of the instrument the member or institution shall be a participant as of the date of the deposit.

Paragraph 4. Changes in Amounts of Credit Arrangements

(a) When a member or institution is authorized under paragraph 3(b) to adhere to this decision, the total amount of credit arrangements may be increased by the Fund with the agreement of participants representing 85 percent of total credit arrangements; the increase shall not exceed the amount of the new participant’s credit arrangement.

(b) The amounts of participants’ individual credit arrangements may be reviewed from time to time in the light of developing circumstances and changed with the agreement of the Fund and of participants representing 85 percent of total credit arrangements, including each participant whose credit arrangement is changed. This provision may be amended only with the consent of all participants.

Paragraph 5. Activation Period

(a) When the Managing Director considers that the Fund’s resources available for the purpose of providing financing to members from the General Resources Account need to be supplemented in order to forestall or cope with an impairment of the international monetary system, and after consultations with Executive Directors and participants, the Managing Director may make a proposal for the establishment of an activation period during which the Fund may (i) make commitments under Fund arrangements for which it may make calls on participants under their credit arrangements, and (ii) fund outright purchases by making calls on participants under their credit arrangements; provided that an activation period shall not exceed 6 months, and provided further that the amount covered by calls to fund such commitments under arrangements and outright purchases shall not exceed the maximum amount specified in the proposal. The proposal for the establishment of an activation period shall include information on (i) the overall size of possible Fund arrangements on which discussions are advanced, (ii) the balance between arrangements that are expected to be drawn upon and arrangements that are expected to be precautionary, (iii) additional financing needs that, in the opinion of the Managing Director, may arise during the proposed activation period, and (iv) the mix of quota and NAB resources for purchases from the General Resources Account in the period following the approval of an activation period. The information will be updated quarterly during an activation period.

(b) If there is not unanimity among the participants, the question whether the participants are prepared to accept the Managing Director’s proposal for the establishment of an activation period in accordance with paragraph 5(a) will be decided by a poll of the participants. A favorable decision shall require an 85 percent majority of total credit arrangements of participants eligible to vote. The decision shall be notified to the Fund.

(c) A participant shall not be eligible to vote if, based on its present and prospective balance of payments and reserve position, the member is not included in the financial transactions plan for transfers of its currency at the time of the decision on a proposal for an activation period.

(d) An activation period shall become effective only if it is accepted by participants pursuant to paragraph 5(b) and is then approved by the Executive Board.

Paragraph 6. Resource Mobilization Plans and Calls

(a) To fund outright purchases during an activation period and commitments under arrangements approved during an activation period, calls under individual credit arrangements of participants may be made on the basis of resource mobilization plans approved by the Executive Board in conjunction with the financial transactions plan for the General Resources Account, normally on a quarterly basis for periods where the New Arrangements to Borrow is activated and for periods up to six months where the New Arrangements to Borrow is not activated. Such resource mobilization plans shall specify for each participant the maximum amount for which calls may be made during the applicable period. The Executive Board may at any time amend such a plan to change the maximum amounts and period for calls. With respect to the allocation of the maximum amounts among participants, the resource mobilization plan shall normally establish an allocation that would result in the available commitments of participants being of equal proportion relative to their credit arrangements

(b) A participant shall not be included in the resource mobilization plan when, based on its present and prospective balance of payments and reserve position, the member is not included and is not being proposed by the Managing Director to be included in the list of countries in the financial transactions plan for transfers of its currency.

(c) Calls during the period of a resource mobilization plan shall be made on participants by the Managing Director with due regard to the objective specified in paragraph 6(a) of achieving available commitments of participants that are of equal proportion relative to their credit arrangements. No call shall be made on a participant that has been included in the resource mobilization plan if, at the time of such call, the member’s currency is not being used in transfers under the financial transactions plan because of the member’s balance of payments and reserve position.

(d) When the Fund makes a call pursuant to this paragraph 6, the participant shall promptly make the transfer in accordance with the call.

Paragraph 7. Procedures for Special Calls

(a) Calls pursuant to paragraph 11(e) may be made at any time with due regard to the objective specified in paragraph 6(a) of achieving available commitments of participants that are of equal proportion relative to their credit arrangements, provided that no such call shall be made on a participant, when, based on its present and prospective balance of payments and reserve position, the member is not included and is not being proposed by the Managing Director to be included in the list of countries in the financial transactions plan for transfers of its currency or, if the member has been included in the financial transactions plan, when, at the time of such call, the member’s currency is not being used in transfers under such plan because of the member’s balance of payments and reserve position. Calls under this paragraph 7(a) shall not be subject to the procedures set forth in either paragraph 5 or paragraph 6.

(b) Calls pursuant to paragraph 23 may be made at any time; they shall not be subject to the procedures set forth in either paragraph 5 or paragraph 6.

(c) When the Fund makes a call pursuant to this paragraph 7, the participant shall promptly make the transfer in accordance with the call.

Paragraph 8. Nature and Evidence of Indebtedness

(a) A participant’s claim on the Fund arising from calls under this decision shall be in the form of a loan to the Fund; provided that, at the request of a participant, the Fund shall issue to the participant and the participant shall purchase, for up to the amount of any call on that participant, one or more promissory notes (each a “Note” or together the “Notes”) that have the same substantive terms as loans extended under this decision and are subject to the General Terms and Conditions for NAB Notes set forth in Annex II to this decision (the “GTC”).¹ The GTC may be amended by a decision of the Fund with the agreement of participants representing 85 percent of total credit arrangements, provided that any amendment of the GTC shall be consistent with the terms of this decision. The amended GTC shall apply upon effectiveness to all outstanding Notes issued under this decision.

(b) In cases where a participant’s claim on the Fund is in the form of a loan, the Fund shall issue to the participant, at its request, instruments evidencing the Fund’s indebtedness. The form of the instruments shall be agreed between the Fund and the participant. upon repayment of the amount of any such instrument and all accrued interest, the instrument shall be returned to the Fund for cancellation. If less than the amount of any such instrument is repaid, the instrument shall be returned to the Fund and a new instrument for the remainder of the amount shall be substituted with the same maturity date as in the old instrument.

(c) In cases where a participant’s claim on the Fund is in the form of Notes, such Notes shall be issued in book entry form. Upon the request of a participant, the Fund shall issue a registered Note substantially in the form as set out in the Appendix to the GTC. upon repayment of any Note and all accrued interest, the Note shall be returned to the Fund for cancellation. If less than the amount of any such Note is repaid, the Note shall be returned to the Fund and a new Note for the remainder of the amount shall be substituted with the same maturity date as in the old Note.

Paragraph 9. Interest

(a) The Fund shall pay interest on its indebtedness under this decision at a rate equal to the combined market interest rate computed by the Fund from time to time for the purpose of determining the rate at which it pays interest on holdings of special drawing rights or any such higher rate as may be agreed between the Fund and participants representing 85 percent of the total credit arrangements.

(b) Interest shall accrue daily and shall be paid as soon as possible after each July 31, October 31, January 31, and April 30.

(c) Interest due to a participant shall be paid, as determined by the Fund in consultation with the participant, in special drawing rights, in the participant’s currency, in the currency borrowed, in freely usable currencies, or, with the agreement of the participant, in other currencies that are actually convertible.

Paragraph 10. Use of Borrowed Currency

The Fund’s policies and practices under Article V, Sections 3 and 7 of the Articles on the use of its general resources, including those relating to the period of use, shall apply to purchases of currency borrowed by the Fund. Nothing in this decision shall affect the authority of the Fund with respect to requests for the use of its resources by individual members, and access to these resources by members shall be determined by the Fund’s policies and practices, and shall not depend on whether the Fund can borrow under this decision.

Paragraph 11. Repayment by the Fund

(a) Subject to the other provisions of this paragraph 11, the Fund, ten years after a transfer by a participant in response to a call under this decision, shall repay the participant an amount equivalent to the transfer calculated in accordance with paragraph 12. If a drawer for whose purchase resources were made available under this decision repurchases on a date earlier than ten years after its purchase, the Fund shall repay participants an equivalent amount during the quarterly period in which the repurchase is made in accordance with paragraph 11(d). Repayment under this paragraph 11(a) or under paragraph 11(c) shall be, as determined by the Fund, in the currency borrowed whenever feasible, in the currency of the participant, in special drawing rights in an amount that does not increase the participant’s holdings of special drawing rights above the limit under Article XIX, Section 4 of the Articles unless the participant agrees to accept special drawing rights above that limit in such repayment, in freely usable currencies, or, with the agreement of the participant, in other currencies that are actually convertible.¹

(b) Before the date prescribed in paragraph 1l(a), the Fund, after consultation with participants, may make repayment in part or in full to one or several participants in accordance with paragraph 11(d). The Fund shall have the option to make repayment under this paragraph 11(b) in the participant’s currency, in the currency borrowed, in special drawing rights in an amount that does not increase the participant’s holdings of special drawing rights above the limit under Article XIX, Section 4 of the Articles unless the participant agrees to accept special drawing rights above that limit in such repayment, in freely usable currencies, or, with the agreement of the participant, in other currencies that are actually convertible.

(c) Whenever a reduction in the Fund’s holdings of a drawer’s currency is attributed to a purchase of currency borrowed under this decision, the Fund shall promptly repay an equivalent amount to participants. If the Fund has used resources under this decision to finance a reserve tranche purchase by a drawer and the Fund’s holdings of the drawer’s currency that are not subject to repurchase are reduced as a result of net sales of that currency during a quarterly period, the Fund shall repay at the beginning of the next quarterly period an amount equivalent to that reduction to participants, up to the amount of the reserve tranche purchase. Payments under this paragraph 11(c) shall be allocated among participants in accordance with paragraph 11(d).

(d) Repayments under paragraphs 11(a), second sentence, 11(b), and 11(c) shall be allocated among participants with due regard to the objective specified in paragraph 6(a) of achieving available commitments of participants that are of equal proportion relative to their credit arrangements. For each participant, repayments shall be applied first to the longest outstanding claim under its credit arrangement. If repayment is to be made in accordance with this paragraph 11(d) on a claim that has been transferred, the repayment shall be made to the transferee of such claim.

(e) Before the date prescribed in paragraph 11(a), a participant may give notice representing that there is a balance of payments need for repayment of part or all of the Fund’s indebtedness and requesting such repayment. The participant seeking such repayment shall consult with the Managing Director and with the other participants before giving notice. The Fund shall give the overwhelming benefit of any doubt to the participant’s representation. Repayment shall be made promptly after consultation with the participant in freely usable currencies or in special drawing rights, as determined by the Fund, or, with the agreement of the participant, in the currencies of other members that are actually convertible. If the Fund’s holdings of currencies in which repayment should be made are not wholly adequate, the Managing Director shall make calls on individual participants to provide the necessary balances under their credit arrangements subject to the limit of their available commitments. At the time of such call, and if so requested by the participant seeking early repayment, (i) a participant providing balances under its credit arrangement that are not balances of a freely usable currency shall ensure that such balances can be exchanged for a freely usable currency of its choice, and (ii) a participant providing balances under its credit arrangement that are balances of a freely usable currency, shall collaborate with the Fund and other members to enable such balances to be exchanged for another freely usable currency.

(f) When a repayment is made on a claim arising from a call under this decision, the amount that can be called for under the credit arrangement of the participant under which the claim arose as a result of a call under this decision shall be restored pro tanto.

(g) unless otherwise agreed between the Fund and a participating institution, the Fund shall be deemed to have discharged its obligations to a participating institution to make repayment in accordance with the provisions of this paragraph 11 or to pay interest in accordance with the provisions of paragraph 9 if the Fund transfers an equivalent amount in special drawing rights to the member in which the participating institution is established.

Paragraph 12. Rates of Exchange

(a) The value of any transfer shall be calculated as of the date of the dispatch of the instructions for the transfer. The calculation shall be made in terms of the special drawing right in accordance with Article XIX, Section 7(a) of the Articles, and the Fund shall be obliged to repay an equivalent value.

(b) For all of the purposes of this decision, the value of a currency in terms of the special drawing right shall be calculated by the Fund in accordance with Rule O-2 of the Fund’s Rules and Regulations.

Paragraph 13. Transferability

(a) No participant or non-participant holder may transfer all or any part of its claim to repayment under a credit arrangement except (i) in accordance with this paragraph 13 or (ii) with the prior consent of the Fund and on such terms and conditions as the Fund may approve.

(b) All or part of any claim to repayment under a credit arrangement may be transferred at any time to a participant or to a non-participant that is either (i) a member of the Fund, (ii) the central bank or other fiscal agency designated by any member for purposes of Article V, Section 1 of the Articles (“other fiscal agency”), or (iii) an official entity that has been prescribed as a holder of special drawing rights pursuant to Article XVII, Section 3 of the Articles.

(c) As from the value date of the transfer, the transferred claim shall be held by the transferee on the same terms and conditions as claims originating under its credit arrangement (in the case of transferees that are participants) or as the claim was held by the transferor (in the case of transferees that are non-participants), except that (i) the transferee shall have the right to request early repayment of the transferred claim on balance of payments grounds pursuant to paragraph 11(e) only if the transferee is a member, or an institution of a member, whose balance of payments and reserve position, at the time of the transfer, is considered sufficiently strong for its currency to be usable in transfers under the Fund’s financial transactions plan; (ii) if the transferee is a non-participant, references to the participant’s currency shall be deemed to refer (A) if the transferee is a member, to the transferee’s currency, (B) if the transferee is an institution of a member, to the currency of that member, and (C) in other cases, to a freely usable currency as determined by the Fund; and (iii) claims transferred in accordance with this paragraph 13 shall be considered drawn balances of the first transferor participant for purposes of determining the available commitment under its credit arrangement, and claims obtained by a participant under a transfer shall not be considered drawn balances of the transferee for purposes of determining the available commitment under its credit arrangement.

(d) The price for the claim transferred shall be as agreed between the transferee and the transferor.

(e) The transferor of a claim shall inform the Fund promptly of the claim that is being transferred, the name of the transferee, the amount of the claim that is being transferred, the agreed price for transfer of the claim, and the value date of the transfer.

(f) The transfer shall be registered by the Fund and the transferee shall become the holder of the claim if the transfer is in accordance with the terms and conditions of this decision. Subject to the foregoing, the transfer shall be effective as of the value date agreed between the transferee and the transferor.

(g) Notice to or by a transferee that is a non-participant shall be in writing or by rapid means of communication and shall be given to or by the fiscal agency designated by the transferee in accordance with Article V, Section 1 of the Articles and Rule G-1 of the Rules and Regulations of the Fund if the transferee is a member, or to or by the transferee directly if the transferee is not a member.

(h) If all or part of a claim is transferred during a quarterly period as described in paragraph 9(b), the Fund shall pay interest to the transferee on the amount of the claim transferred for the whole of that period.

(i) unless otherwise agreed between the Fund and a transferee that is either a participating institution or the central bank or other fiscal agency designated by any member for purposes of Article V, Section 1 of the Articles, the Fund shall be deemed to have discharged its obligations to make repayment to such transferee in special drawing rights in accordance with paragraph 11 or to pay interest in special drawing rights in accordance with paragraph 9 if the Fund transfers an equivalent amount in special drawing rights to the account of the member in which the institution is established.

(j) If requested, the Fund shall assist in seeking to arrange transfers.

(k) The transferee of a claim may request at the time of transfer that a claim in the form of a loan be exchanged by the Fund for a Note on the same substantive terms subject to the GTC, or that a claim in the form of a Note be exchanged for a loan claim on the same substantive terms.

(l) Derivative transactions in respect of any claim under this decision, and transfer of participation interests in any claim, are prohibited.

Paragraph 14. Notices

Notice to or by a participating member under this decision shall be in writing or by rapid means of communication and shall be given to or by the fiscal agency of the participating member designated in accordance with Article V, Section 1 of the Articles and Rule G-1 of the Rules and Regulations of the Fund. Notice to or by a participating institution shall be in writing or by rapid means of communication and shall be given to or by the participating institution.

Paragraph 15. Amendment

(a) Except as provided in paragraphs 4(b), 15(b), and 16, this decision may be amended during the period prescribed in paragraph 19(a) and any subsequent renewal periods that may be decided pursuant to paragraph 19(b) only by a decision of the Fund and with the concurrence of participants representing 85 percent of total credit arrangements. Such concurrence shall not be necessary for the modification of the decision on its renewal pursuant to paragraph 19(b).

(b) If in its view an amendment materially affects the interest of a participant that voted against the amendment, the participant shall have the right to withdraw its adherence to this decision by giving notice to the Fund and the other participants within 90 days from the date the amendment was adopted. This provision may be amended only with the consent of all participants.

Paragraph 16. Withdrawal of Adherence

Without prejudice to paragraph 15(b), a participant may withdraw its adherence to this decision in accordance with paragraph 19(b) but may not withdraw within the period prescribed in paragraph 19(a) except with the agreement of the Fund and all participants. This provision may be amended only with the consent of all participants.

Paragraph 17. Withdrawal from Membership

If a participating member or a member whose institution is a participant withdraws from membership in the Fund, the participant’s credit arrangement shall cease at the same time as the withdrawal takes effect. The Fund’s indebtedness under the relevant credit arrangement shall be treated as an amount due from the Fund for the purpose of Article XXVI, Section 3 and Schedule J of the Articles.

Paragraph 18. Suspension of Exchange Transactions and Liquidation

(a) The right of the Fund to make calls under paragraphs 6, 11(e), and 23 and the obligation to make repayments under paragraph 11 shall be suspended during any suspension of exchange transactions under Article XXVII of the Articles.

(b) In the event of liquidation of the Fund, credit arrangements shall cease and the Fund’s indebtedness shall constitute liabilities under Schedule K of the Articles. For the purpose of paragraph 1(a) of Schedule K, the currency in which the liability of the Fund shall be payable shall be first the currency borrowed, then the participant’s currency and finally the currency of the drawer for whose purchases transfers were made by the participants in connection with calls under paragraph 6.

Paragraph 19. Period and Renewal

(a) This decision shall continue in existence for a period of five years from November 16, 2022. When considering a renewal of this decision for any period following the period referred to in this paragraph 19(a), the Fund and the participants shall review the functioning of this decision and, in particular, (i) the experience with the procedures for activation and (ii) the impact of the Fifteenth General Review of Quotas on the overall size of quotas, and shall consult on any possible modifications.

(b) This decision may be renewed for such period or periods and with such modifications, subject to paragraphs 4(b), 15(b), and 16, as the Fund may decide. The Fund shall adopt a decision on renewal and modification, if any, not later than twelve months before the end of the period prescribed in paragraph 19(a). Any participant may advise the Fund not less than six months before the end of the period prescribed in paragraph 19(a) that it will withdraw its adherence to the decision as renewed. In the absence of such notice, a participant shall be deemed to continue to adhere to the decision as renewed. Withdrawal of adherence in accordance with this paragraph 19(b) by a participant shall not preclude its subsequent adherence in accordance with paragraph 3(b).

(c) If this decision is terminated or not renewed, paragraphs 8 through 14, 17 and 18(b) shall nevertheless continue to apply in connection with any indebtedness of the Fund under credit arrangements in existence at the date of the termination or expiration of the decision until repayment is completed. If a participant withdraws its adherence to this decision in accordance with paragraph 15(b), paragraph 16, or paragraph 19(b), it shall cease to be a participant under the decision, but paragraphs 8 through 14, 17, and 18(b) of the decision as of the date of the withdrawal shall nevertheless continue to apply to any indebtedness of the Fund under such former credit arrangement until repayment has been completed.

Paragraph 20. Interpretation

Any question of interpretation raised in connection with this decision (including the GTC) which does not fall within the purview of Article XXIX of the Articles shall be settled to the mutual satisfaction of the Fund, the participant or transferee of a claim raising the question, and all other participants. For the purpose of this paragraph 20 participants shall be deemed to include those former participants to which paragraphs 8 through 14, 17, and 18(b) continue to apply pursuant to paragraph 19(c) to the extent that any such former participant is affected by a question of interpretation that is raised.

Paragraph 21. Relationship with the General Arrangements to Borrow and Associated Borrowing Arrangements

(a) When considering whether to activate the New Arrangements to Borrow or the General Arrangements to Borrow, the Fund shall be guided by the principle that the New Arrangements to Borrow shall be the facility of first and principal recourse, except that in the event that a proposal for the establishment of an activation period under the New Arrangements to Borrow is not accepted under paragraph 5(a), a proposal for calls may be made under the General Arrangements to Borrow.

(b) Outstanding drawings and available commitments under the New Arrangements to Borrow and the General Arrangements to Borrow shall not exceed SDR 180,572.58 million, or such other amount of total credit arrangements as may be in effect in accordance with this decision. The available commitment of a participant under the New Arrangements to Borrow shall be reduced pro tanto by any outstanding drawings on, and commitments of, the participant under the General Arrangements to Borrow. The available commitment of a participant under the General Arrangements to Borrow shall be reduced pro tanto by the extent to which its credit arrangement under the General Arrangements to Borrow exceeds its available commitment under the New Arrangements to Borrow.

(c) References to drawings and commitments under the General Arrangements to Borrow shall include drawings and commitments under the Associated Borrowing Arrangements referred to in paragraph 23 of the General Arrangements to Borrow.

Paragraph 22. Other Borrowing Arrangements

Nothing in this decision shall preclude the Fund from entering into any other types of borrowing arrangements.

Paragraph 23. Transitional Arrangements for Amendments Adopted Pursuant to Decision No. 14577-(10/35)

At the request of a participant that holds claims, either in the form of loans or notes, on the Fund under bilateral borrowing agreements entered into by the Fund prior to March 11, 2011, the Managing Director shall make calls under the credit arrangement of such a participant to fund the repayment of such claims. Similarly, at the request of the relevant participant, calls shall be made on a participant that is a participating institution for the repayment of such claims held by the member of which it is an official institution or by the central bank or other fiscal agency designated by the member, or on a participant that is a member for the repayment of such claims held by the central bank or other fiscal agency designated by the member. Notwithstanding paragraph 11(a), the maturity date of claims under credit arrangements arising from such calls shall be the maturity date of the bilateral borrowing agreement claim for whose repayment the call was made.

Paragraph 24. Delay in Drawings

No drawings shall be made under this decision until participants representing at least 70 percent of the total credit arrangements of new participants listed in Annex I have adhered to this decision in accordance with paragraph 3(c).

Decision No. 11428-(97/6),

January 27, 1997,

as amended by Decision Nos. 12880-(02/113),

12881-(02/113), November 12, 2002,

13996-(07/100), November 15, 2007,

14577-(10/35), April 12, 2010,

14721-(10/80), August 5, 2010,

15014-(11/110), November 16, 2011,

15072-(12/1), December 21, 2011, and

16079-(16/99),

November 4, 2016

Attachment I, Annex I

Participants and Amounts of Credit Arrangements

(In Millions of SDRs)¹

Current Participants	Amount2
Australia	2,220.45
Austria	1,818.49
Banco Central de Chile	690.97
Banco de Portugal	783.50
Bangko Sentral ng Pilipinas	340.00
Bank of Israel	340.00
Belgium	3,994.33
Brazil	4,440.91
Canada	3,873.71
China	15,860.38
Cyprus	340.00
Danmarks Nationalbank	1,629.76
Deutsche Bundesbank	12,890.02
Finland	1,133.88
France	9,479.16
Hong Kong Monetary Authority	340.00
India	4,440.91
Italy	6,898.52
Japan	33,508.50
Korea	3,344.82
Kuwait	341.29
Luxembourg	493.12
Malaysia	340.00
Mexico	2,537.66
National Bank of Poland	1,285.40
Netherlands	4,594.80
New Zealand	340.00
Norway	1,966.69
Russian Federation	4,440.91
Saudi Arabia	5,652.74
Singapore	648.55
South Africa	340.00
Spain	3,405.14
Sveriges Riksbank	2,255.68
Swiss National Bank	5,540.66
Thailand	340.00
United Kingdom	9,479.16
United States	28,202.47
Prospective Participants
Greece	840.60
Ireland	957.97
Total	182,371.1

View Table

Current Participants	Amount2
Australia	2,220.45
Austria	1,818.49
Banco Central de Chile	690.97
Banco de Portugal	783.50
Bangko Sentral ng Pilipinas	340.00
Bank of Israel	340.00
Belgium	3,994.33
Brazil	4,440.91
Canada	3,873.71
China	15,860.38
Cyprus	340.00
Danmarks Nationalbank	1,629.76
Deutsche Bundesbank	12,890.02
Finland	1,133.88
France	9,479.16
Hong Kong Monetary Authority	340.00
India	4,440.91
Italy	6,898.52
Japan	33,508.50
Korea	3,344.82
Kuwait	341.29
Luxembourg	493.12
Malaysia	340.00
Mexico	2,537.66
National Bank of Poland	1,285.40
Netherlands	4,594.80
New Zealand	340.00
Norway	1,966.69
Russian Federation	4,440.91
Saudi Arabia	5,652.74
Singapore	648.55
South Africa	340.00
Spain	3,405.14
Sveriges Riksbank	2,255.68
Swiss National Bank	5,540.66
Thailand	340.00
United Kingdom	9,479.16
United States	28,202.47
Prospective Participants
Greece	840.60
Ireland	957.97
Total	182,371.1

Attachment to SM/96/307

NAB Meetings

In the course of establishing the new arrangements to borrow (NAB), understandings were reached on procedures and administrative arrangements for meetings of participants. These understandings are intended to complement, but do not supersede or modify, the provisions related to the activation of the new arrangements to borrow, as specified in the Fund decision.

Frequency, timing, subject matter, and level of representation

Participants agreed that, in addition to any meetings needed for activation, renewal, or amendment of the NAB, it would be appropriate for participants to meet once a year at the time of the annual Fund/Bank meetings to discuss matters pertaining to the NAB. The objective of these meetings would be to review and discuss macroeconomic and financial markets developments, especially those that could have an impact on the stability of the financial system and lead to a possible need for the Fund to seek supplementary resources for the purposes set out in the preamble of the NAB. Participants would be represented by a minister or central bank governor or both. The principal representative could appoint deputies to meet in their stead. The level of the meeting (Ministerial or Deputy) would be determined each year in light of the issues at hand.

Chairmanship

The Chairmanship of the NAB grouping would rotate annually in the English alphabetical order of the participants, as listed in the Annex to the decision, beginning with the first name on that list.¹ The Chair would, in consultation with participants, be responsible for determining the agenda of the meeting, which will be devoted to the matters set out above. These consultations would also serve to determine the level of representation (Ministerial or Deputy) that would be most appropriate for the meeting in question.

Support

IMF headquarters staff would, under the direction of the Chair, provide secretariat support for the group. This would entail providing logistic support and maintaining an archive of documents concerning the deliberations and decisions taken under the new arrangements to borrow.

The Rollback of Credit Arrangements in the New Arrangements to Borrow (NAB)—Change in Credit Arrangements and Amendment

1. Subject to paragraphs 3 and 4 below, the credit arrangements of current and prospective participants in the New Arrangements to Borrow (NAB) set out in Annex 1 to Executive Board Decision No. 11428-(97/6), adopted January 27, 1997, as amended (“Annex I to the NAB Decision”), shall be changed as set out in the Attachment to SM/11/331, 12/15/11 (“Attachment”).

2. Subject to paragraph 5 below, Paragraph 11(b) of the NAB Decision shall be amended by adding the following as a new last sentence:

“At the request of a participant, the Fund shall repay, in accordance with this subparagraph (b), any claims resulting from calls under the participant’s credit arrangement that exceed the amount of the participant’s credit arrangement as changed in accordance with Executive Board Decision No. 15073 adopted December 21, 2011, provided that no such repayment shall be made until the quota increase for the relevant member under the Fourteenth General Review of Quotas has become effective.”

3. The changes in credit arrangements for participants set forth in paragraph 1 above shall become effective for each participant on the day the relevant member pays its quota increase under the Fourteenth General Review of Quotas, provided that no change in credit arrangements shall become effective until participants representing at least 85 percent of total credit arrangements, including each participant whose credit arrangement is changed, have agreed to the changes in credit arrangements of participants.

4. A prospective participant’s adherence to the NAB shall not become effective until the prospective participant consents to the proposed changes in credit arrangements set forth in paragraph 1 above.

5. The amendment to the NAB Decision set forth in paragraph 2 above, shall become effective when NAB participants representing at least 85 percent of total credit arrangements have concurred in the amendment. (SM/11/331, 12/15/11)

Decision No. 15073-(12/1),

December 21, 2011

New Arrangements to Borrow—Transferability of Claims

Pursuant to paragraph 13 of the New Arrangements to Borrow (NAB), the Fund consents in advance to the transfer of outstanding claims to repayments under the NAB on the terms and conditions set out below:

1. All or part of any claim under the NAB may be transferred at any time to a participant in the NAB.

2. As from the value date of the transfer, the transferred claim shall be held by the transferee on the same terms and conditions as claims originating under its credit arrangement, except that the transferee shall acquire the right to request early repayment of the transferred claim on balance of payments grounds pursuant to paragraph 11(e) of the NAB only if, at the time of the transfer, (i) the transferee is a member, or the institution of a member, whose balance of payment and reserve position is considered sufficiently strong for its currency to be usable in net transfers in the Fund’s operational budget; or (ii) the transferee is the institution of a non-member, and the balance of payments and reserve position of the nonmember is, in the opinion of the Fund, sufficiently strong to justify such acquisition.

3. The price for the claim transferred shall be as agreed between the transferee and the transferor.

4. The transferor of a claim shall inform the Fund promptly of the claim that is being transferred, the name of the transferee, the amount of the claim that is being transferred, the agreed price for transfer of the claim, and the value date of the transfer.

5. The transfer shall be registered by the Fund if it is in accordance with the terms and conditions of this decision. The transfer shall be effective as of the value date agreed between the transferee and the transferor.

6. If all or part of a claim is transferred during a quarterly period as described in paragraph 9(c) of the NAB, the Fund shall pay interest to the transferee on the amount of the claim transferred for the whole of that period.

7. If requested, the Fund shall assist in seeking to arrange transfers.

8. This decision shall become effective on the date of effectiveness of the NAB.

Decision No.11429-(97/6),

January 27, 1997

Establishment of the Borrowed Resources Suspense Accounts

1. The Managing Director is authorized (i) to establish Borrowed Resources Suspense Accounts within the General Department, (ii) to transfer to these Accounts balances of currencies borrowed before these can be used in transactions or received in repurchases made before repayment can be made, and (iii) to invest these balances until they can be transferred to the General Resources Account for immediate use in a transaction or an operation.

2. A Borrowed Resources Suspense Account for each currency shall be opened, as needed, with the depository designated pursuant to Article XIII, Section 2, by a member whose currency is to be borrowed, used for investment, or used in repayment or the payment of interest and shall be operated in accordance with the standard procedures for the operation of the Fund’s No. 1 and Securities Accounts with the depository.

Decision No. 6844-(81/75),

May 5, 1981

Investment by the Fund of the Currencies Held in the Borrowed Resources Suspense Accounts

1. The Managing Director is authorized to invest currencies held in the Borrowed Resources Suspense Accounts in one or more of the following ways: (a) deposits with a national official financial institution of a member, or an international financial institution, that are denominated in special drawing rights; (b) marketable obligations issued by a member or by a national official institution of a member and denominated in special drawing rights; and (c) marketable obligations issued by an international financial institution and denominated in special drawing rights.

2. The policy on the investment of the undisbursed amounts held in the Borrowed Resources Suspense Accounts shall take into account the operational needs of the General Resources Account, including the dates on which members are expected to make purchases from the Fund under its Policy on Enlarged Access.

3. (a) The Managing Director, when making arrangements for the placement of investments in accordance with paragraphs 1 and 2 above, shall consider the terms offered by a national official financial institution of the member issuing the currency borrowed, or to which the borrowed funds may be transferred, that will accept investments denominated in special drawing rights, and the terms offered by the Bank for International Settlements, for all or part of the intended investment in SDR-denominated deposits.

(b) In the event the Managing Director considers that none of the offers made by the central banks and by the BIS is sufficiently attractive, he shall inform the Executive Board promptly and make other proposals to it for investment in SDR-denominated obligations.

4. The Managing Director is authorized to transfer borrowed funds at the time of the original receipt from the Borrowed Resources Suspense Account in the depository designated by the member whose currency was borrowed to the Borrowed Resources Suspense Account in the depository designated by the member whose currency is to be used in an investment when this transfer is necessary to effect an investment denominated in special drawing rights, and when this transfer has been concurred in by the two members whose currencies will be involved.

Decision No. 6845-(81/75),

May 5, 1981

Guidelines for Borrowing by the Fund

Quota subscriptions are and should remain the basic source of the Fund’s financing. However, on a temporary basis, borrowing by the Fund can provide an important supplement to its resources. The confidence of present and potential creditors in the Fund will depend not only on the prudence and soundness of its financial policies but also on the effective performance of its various responsibilities, including, in particular, its success in promoting crisis prevention, adjustment, sustainable growth, and financial stability. Against this background, the following guidelines shall apply for borrowing by the Fund.

1. Fund borrowing shall remain subject to a process of continuous monitoring by the Executive Board in the light of the above considerations. For this purpose, the Executive Board will regularly review the Fund’s liquidity and financial position, taking into account all relevant factors of a quantitative and qualitative nature.

2. The Executive Board may establish at any time, in the context of circumstances prevailing at that time, limits expressed in terms of the total of Fund quotas above which the total of outstanding borrowing plus unused credit lines would not be permitted to rise.

3. Any limits that may be adopted pursuant to paragraph 2 above are not to be understood, at any time, as targets for borrowing by the Fund.

4. (a) For purposes of these guidelines, bilateral borrowing agreements concluded by the Fund as part of the 2012 borrowing exercise and consistent with the modalities approved in June 2012 are referred to as “2012 Borrowing Agreements”. Bilateral borrowing agreements entered into or amended by the Fund pursuant to the borrowing framework approved in August 2016 shall be referred to as the “2016 Borrowing Agreements.” The 2016 Borrowing Agreements, together with the 2012 Borrowing Agreements, shall be collectively referred to as the “Bilateral Borrowing Agreements”.

(b) The Bilateral Borrowing Agreements shall be activated for use by the Fund under the terms of such agreements only after the Managing Director has notified the Executive Board that the Forward Commitment Capacity of the Fund as defined in Decision No. 14906-(11/38), adopted April 20, 2011, taking into account all available uncommitted resources under the New Arrangements to Borrow (the “modified FCC”), is below SDR 100 billion (the “activation threshold”); provided however that the Managing Director shall not provide such notification to the Executive Board unless:

(i) the New Arrangements to Borrow (“NAB”) are activated as of the time of the notification, or there are no available uncommitted resources under the NAB as of that time; and (ii) the activation of the 2016 Borrowing Agreements has been approved by creditors representing at least 85 percent of the total credit amount committed under the 2016 Borrowing Agreements by creditors eligible to vote on such activation. For the purposes of conducting a poll of eligible creditors on such activation, the Managing Director shall propose in writing to eligible creditors the activation of the 2016 Borrowing Agreements and request the creditors’ vote on the activation. only creditors under the 2016 Borrowing Agreements may vote on the activation, except that any such creditor shall not be eligible to vote if, at the time of the vote, its 2016 Borrowing Agreement is not effective or the relevant member is not included in the Fund’s Financial Transactions Plan for transfers of its currency.

(ii) the activation of the 2016 Borrowing Agreements has been approved by creditors representing at least 85 percent of the total credit amount committed under the 2016 Borrowing Agreements by creditors eligible to vote on such activation. For the purposes of conducting a poll of eligible creditors on such activation, the Managing Director shall propose in writing to eligible creditors the activation of the 2016 Borrowing Agreements and request the creditors’ vote on the activation. only creditors under the 2016 Borrowing Agreements may vote on the activation, except that any such creditor shall not be eligible to vote if, at the time of the vote, its 2016 Borrowing Agreement is not effective or the relevant member is not included in the Fund’s Financial Transactions Plan for transfers of its currency.

(c) If the Bilateral Borrowing Agreements are activated pursuant to paragraph 4(b) above, they shall automatically be deactivated when the NAB is no longer activated, unless there are no available uncommitted resources under the NAB at that time. Separately, the Bilateral Borrowing Agreements shall be deactivated if the Managing Director has notified the Executive Board that the modified FCC (excluding any amounts available under the Bilateral Borrowing Agreements) has risen above the activation threshold, and: (i) the Executive Board determines that activation is no longer necessary; or (ii) six months have elapsed since the date of the Managing Director’s notification and, within that period, the modified FCC (excluding any amounts available under the Bilateral Borrowing Agreements) has not fallen below the activation threshold. If, after the deactivation of the Bilateral Borrowing Agreements under this paragraph 4(c), the modified FCC were to fall below the activation threshold, the provisions of paragraph 4(b) will apply.

5. The Fund is expected to use any quota increases under the Fifteenth General Review of Quotas to reduce and, depending on the size of the quota increases and the Fund’s liquidity, eliminate its reliance on bilateral borrowing agreements.

6. In the context of approval of the Financial Transactions Plan, the Executive Board shall determine (a) the appropriate mix between borrowed resources and quota resources, and (b) the appropriate amounts to be drawn across different sources of borrowed resources. In making these determinations, the Fund shall take into account the Fund’s liquidity needs and the expected availability of borrowed and quota resources, among other relevant considerations.

7. The Fund shall aim to maintain equitable burden sharing among creditors in accordance with the burden sharing rules that are applicable to each source of borrowed resources under the relevant agreements and decisions applicable to that source, including equitable burden sharing among creditors under all Bilateral Borrowing Agreements.

8. The Executive Board shall review these guidelines before December 31, 2019. (EBS/16/77, Sup. 3, 09/01/16)

Decision No. 9862-(91/156),

November 15, 1991,

as amended by Decision Nos. 14367-(09/65), June 29, 2009,

15176-(12/58), June 15, 2012,

15830-(15/70), July 13, 2015, and

16042-(16/77),

August 29, 2016

The Chairman’s Summing Up—Maintaining Access to Bilateral Borrowing and Review of the Borrowing Guidelines Executive Board Meeting 16/77, August 29, 2016

Executive Directors welcomed the opportunity to discuss the framework to maintain temporary access to bilateral borrowing by the Fund and to review the Fund’s Borrowing Guidelines. They acknowledged that the 2012 Borrowing Agreements have played a critical role as a third line of defense after quotas and the New Arrangements to Borrow (NAB) in providing confidence to members and markets that the Fund has adequate resources to meet the membership’s potential needs if tail risks materialized.

While reiterating that the Fund is and must remain a quota-based institution, Directors recognized that securing continued access to bilateral borrowing is the most practical option to maintain the Fund’s overall lending capacity amid elevated risks in the global economy. They observed that while risks in the euro area have eased and the strengthening of regulatory reform and the global financial safety net has advanced, global risks remain elevated.

Against this background, Directors broadly endorsed the staff’s proposal to maintain bilateral borrowing as a third line of defense, and welcomed the proposed new elements of the 2016 borrowing framework, which will strengthen the role creditors have in the activation of the borrowing agreements while building closely on the key modalities of the 2012 borrowing framework. In particular, Directors supported the new multilateral voting structure, which would give creditors a formal say in the activation of the agreements. Directors expressed varying views with regard to the voting majority requirement for activation of the agreements. With a view to secure broad support, Directors agreed to adopt an 85 percent majority requirement.

Directors welcomed the inclusion of the activation requirements in the 2016 Borrowing Agreements, in addition to their inclusion in the Borrowing Guidelines, so that the conditions can only be changed with the agreement of creditors.

Directors supported a common maximum end date for the 2016 Borrowing Agreements of end-2020, avoiding the staggered expiration of the agreements under the 2012 framework. Most Directors supported an initial term through end-2019, extendable by one year through end-2020. While many agreed that the extension could be approved by the Executive Board by a simple majority in consultation with creditors, others preferred that the one-year extension would require consent from creditors. A number of Directors would have preferred adopting the modality for the 2012 Borrowing Agreements consisting of an initial two-year term and two subsequent one-year extensions, with the final extension requiring creditor consent. on balance, Directors agreed to an initial term through end-2019, extendable by one year by the Fund and requiring, with respect to the extension of each individual agreement, consent of the creditor of that agreement.

Directors endorsed the key provisions of the proposed 2016 Borrowing Agreements as proposed in EBS/16/77 and Supplement 1, with the modification to the proposal set out in EBS/16/77, Sup. 2, and with further modifications discussed at the Board meeting. They stressed that the key provisions should be the same across all 2016 agreements, although drafting variations not affecting the substance of these key provisions could be accommodated.

Directors considered that the Fund’s Borrowing Guidelines remain appropriate and endorsed the proposed modifications in the Borrowing Guidelines to reflect the new voting structure and terms of the 2016 Borrowing Agreements, including burden-sharing among creditors. Directors also supported the arrangements for handling the transition from the 2012 to the 2016 framework, as set out in EBS/16/77, Sup. 1.

Directors welcomed the indications expressed by many chairs that members in their constituencies would be willing to maintain access to their borrowing agreements or consider providing new borrowing agreements under the new framework. Directors noted the importance of securing broad participation by members and looked forward to concluding as many agreements as possible by the Annual Meetings in early october.

Directors underscored that borrowing provides only temporary and supplementary resources to quota resources and that the new agreements should not lead to any delay in the 15th General Quota Review. A number of Directors stressed that members’ voluntary financial contributions, including participation in the bilateral borrowing agreements, should be recognized in the deliberations on future quota adjustments. It was agreed that this issue be taken up in the context of the 15th Review discussions.

BUFF/16/66

September 1, 2016

The Chairman’s Summing Up—Borrowing by the Fund—Proposed Modalities Executive Board Meeting 12/58, June 15, 2012

Executive Directors welcomed the opportunity to discuss the modalities for a 2012 round of bilateral borrowing by the Fund and to review the Fund’s borrowing guidelines in the context of the membership’s cooperative efforts to increase Fund resources by over $430 billion. They generally considered that the proposed borrowing modalities, which build on the framework adopted for the 2009 borrowing round and the New Arrangements to Borrow (NAB), provide a good basis for compromise. Directors recognized that a careful balance needs to be struck between lenders’ preferences and safeguarding the Fund’s balance sheet. They agreed that it would be important to move rapidly to conclude borrowing agreements.

Directors noted that the scale of potential borrowing, if fully drawn, would be unprecedented in relation to quota resources and would increase financial risks for the Fund, amid the potential for large lending with highly correlated risks. They stressed that the primary tool to mitigate risks is the strength of the Fund’s lending policies, supported by adequate junior co-financing.

Directors underscored that borrowing provides only temporary and supplementary resources and that the Fund is, and should remain, a quota-based institution. Mindful of the timetable envisaged for the 15th General Review of Quotas, Directors agreed that the initial term of the 2012 bilateral borrowing agreements should be for two years, and most supported the proposal that this term be extendable by one year after consultation with lenders, and following a Board decision approving the extensions. Thereafter, an additional one-year extension would be possible, subject to the lender’s consent and to a Board decision approving the further extensions. A few Directors would have preferred that the first one-year extension also be subject to the lender’s consent. Directors expected that any quota increases under the 15th Review would be used by the Fund to reduce and, depending on the size of the quota increase and the Fund’s liquidity, eliminate its reliance on bilateral borrowing. In this context, a few Directors cautioned against prejudging the outcome of the 15th Review, while a few others favored a stronger link through a roll-back clause to reduce a creditor’s bilateral claims in an amount equivalent to its quota increase.

Directors stressed the need to protect the Fund against mismatches between its borrowing and lending maturities. Given the similar treatment under the NAB, they agreed that the maximum maturity of claims under the 2012 bilateral agreements should be 10 years. Directors broadly concurred that lenders should indicate that they stand ready to cooperate with the Fund as needed and appropriate. In addition, or as an alternative, for those lenders who are willing, the borrowing agreements should allow for an extension of the maximum maturity of claims for up to another 5 years with the lender’s consent, in exceptional circumstances involving a shortage of Fund resources in relation to Fund obligations falling due.

Directors supported full and immediate encashability of all claims on the Fund arising under the 2012 borrowing agreements in case of balance-of-payments need of the relevant member, allowing these claims to qualify as reserve assets. They broadly concurred that the agreements should not include weekly or monthly limits on drawings, but that the case for introducing such limits could be revisited in the future, if warranted in light of developments. Directors also agreed that there should be reciprocity among agreements that would authorize the Fund to draw on the 2012 agreements to fund encashment requests related to other creditors’ claims outstanding under those agreements; these encashment drawings could be made under the 2012 agreements for as long as claims under these agreements remain outstanding. Most Directors considered that, to the maximum extent possible, the borrowing agreements should provide for revolving lines of credit as under the NAB, with a few Directors suggesting that this should be mandatory for all agreements.

Directors stressed that the new borrowing agreements should provide a second line of defense after quota and NAB resources, and consistent with this understanding, many underlined that the new borrowing agreements should only be activated when the NAB is also activated, unless there are no available uncommitted NAB resources remaining. Directors therefore agreed that the Fund’s Guidelines for Borrowing should specify that access to the new agreements should only be triggered when a modified version of the Fund’s Forward Commitment Capacity, taking into account all available uncommitted NAB resources, has reached a certain threshold level, and the NAB is activated or there are no available uncommitted NAB resources remaining. A few Directors requested that the activation of the NAB as a condition for drawing upon the borrowing arrangements be included in each agreement. Although there were a few differences of views on the appropriate level of the threshold, Directors supported setting the threshold at SDR 100 billion, and most considered that the Board should retain the flexibility to revisit the threshold level in the future if warranted. A few Directors would have preferred introducing a supermajority requirement among bilateral creditors as a precondition for any recourse to the new bilateral borrowing.

Directors supported other key substantive modalities and details for the 2012 bilateral borrowing agreements as proposed in SM/12/126 and Supplements 1 and 2. They also stressed that the key substantive terms for the 2012 borrowing agreements should be the same across all the 2012 agreements, although drafting variations not affecting the substance of these key terms could be accommodated.

Directors considered that the Guidelines for Borrowing by the Fund remain appropriate in most respects. There was broad support for the proposed modifications to reflect certain aspects of the modalities and terms of the 2012 bilateral borrowing agreements.

BUFF/12/67

June 20, 2012

A Framework for the Fund’s Issuance of Notes to the Official Sector

1. The Fund endorses the form Note Purchase Agreement (NPA), the General Terms and Conditions for International Monetary Fund Series A and Series B Notes, and the form of registered Series A and B notes that are set out in the Attachment to EBS/09/96, Supplement 2.

2. The Fund is prepared to consider the approval of NPAs with members or central banks of members whose balance of payments and reserve position is sufficiently strong in the opinion of the Fund that their currency is being used in transfers under the Financial Transactions Plan. It is expected that such approval will be sought on a lapse-of-time basis.

3. The conclusion of NPAs shall be subject to the Fund’s guidelines on borrowing, as amended from time to time. (EBS/09/96,

Sup. 2, 7/6/09)

Decision No. 14379-(09/67),

July 1, 2009