Income model reform
The business model that the IMF has followed since it was established relies primarily on income from its lending operations to finance its work. Lending generates income because the IMF charges member countries that draw on its financial resources a higher interest rate than it pays to its member country creditors (this lending margin will be one percentage point during 2008-09). However, this model had become unsustainable in recent years because of a sharp drop-off in lending activity.
A Committee of Eminent Persons, set up in January 2007 and chaired by Andrew Crockett (former general manager of the Bank of International Settlements), recommended that the IMF adopt a package of income-generating measures, including strictly limited sales of gold (amounting to about one-eighth of the Fund's total gold holdings), to establish an endowment.
In 2008, the IMF's Board of Governors endorsed a new package of measures to end the IMF's over-reliance on lending income. The package included most of the measures that had been proposed by the Crockett Committee.