## BPM7 Annex 9. Positions and Transactions with the IMF: Annotated Outline

## Source details

**Canonical URL:** [BPM7 Annex 9. Positions and Transactions with the IMF: Annotated Outline](https://www.imf.org/-/media/files/data/statistics/bmp7/chapters/ao-bpm-ann-9.pdf)

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### I. Introduction — purpose and scope
- The Annex is an update to Annex 7.1, BPM6, and will be mainly based on BPM6 Annex 7.1 with inputs from other macroeconomic statistics manuals/guides.
- The Annex will maintain the BPM6 structure with additions from other manuals and will have:
  - Section I: introduction covering the main channels of lending, concepts of fiscal agency and depository, and brief descriptions.
  - Section II: recording of positions and transactions with the IMF focusing on items relevant for international accounts.
- The Annex facilitates proper understanding of recording IMF arrangements in international accounts by drawing on IMF Financial Operations, fourth edition, and relevant BPM6 material.
- A core responsibility of the IMF is to make financing available to member countries experiencing actual, potential, or prospective balance of payments problems, including when the country cannot find sufficient financing on affordable terms to meet its net international payments.

### I.A Non‑Concessional (GRA) lending — channels and resources
- Channels:
  - General Resources Account (GRA) provides non-concessional lending available to all Fund members.
  - Major non-concessional lending facilities include:
    - Stand-By Arrangement (SBA)
    - Extended Fund Facility (EFF)
    - Flexible Credit Line (FCL)
    - Precautionary and Liquidity Line (PLL)
    - Short-term Liquidity Line (SLL)
    - Rapid Financing Instrument (RFI)
  - Brief descriptions of these facilities will be added based on Table 2.5 of IMF Financial Operations, fourth edition.
- Resources (borrowing by the IMF):
  - Quota subscriptions are the primary source of financing.
  - The IMF can supplement quota resources through borrowing when resources may fall short of members’ needs.
  - Borrowing can be conducted under main standing borrowing arrangements, namely the New Arrangements to Borrow (NAB) and bilateral borrowing agreements (BBAs).

### I.B Concessional (PRGT) lending — channels and resources
- Channels:
  - Poverty Reduction and Growth Trust (PRGT) provides concessional lending to low-income countries.
  - Concessional lending facilities include:
    - Extended Credit Facility (ECF)
    - Standby Credit Facility (SCF)
    - Rapid Credit Facility (RCF)
  - Brief descriptions of these facilities will be added based on Table 3.2 of IMF Financial Operations, fourth edition.
- Resources:
  - Concessional operations are funded through contributions by a broad segment of the membership and by the IMF; resources are administered under the PRGT.

### I.C Debt Relief — trusts and treatment
- Debt relief resources are administered under:
  - Trust for Special Poverty and Growth Operations for the Heavily Indebted Poor Countries and Interim ECF Subsidy Operations (PRG-HIPC)
  - Catastrophe Containment and Relief Trust (CCR)
- The IMF acts as trustee for these trusts, mobilizing and managing resources for concessional operations.
- IMF debt relief operations are based on trusts established by the Fund.

### I.D Resilience and Sustainability Trust (RST) lending
- A new trust established in 2022: RST to help low-income, small states, and vulnerable middle-income countries tackle long-term structural challenges including climate change and pandemics.
- RST resources are mobilized based on voluntary contributions from IMF members with strong external positions, including those wishing to channel Special Drawing Rights (SDRs) for the benefit of eligible members.

### I.E Fiscal agency and depository
- The IMF conducts financial dealings with a member through the fiscal agency and the depository designated by the member.
- A brief explanation of the concepts of fiscal agency and depository will be provided in the Annex.

### II. Recording of positions and transactions with the IMF — overview
- Section II will cover recording of positions and transactions relevant for international accounts, with subsections:
  - A. Quotas (paragraphs 7.75–76)—no significant changes
  - B. Reserve Position in the IMF (paragraphs 7.77–78)—no significant changes
  - C. Credit and Loans from the IMF
  - D. Debt Relief Through IMF Managed Trusts
  - E. Lending to IMF and IMF Managed Trusts
  - F. Remuneration (paragraphs 7.82)—no significant changes
  - G. IMF No.2 Account (paragraphs 7.82)—no significant changes
  - H. Special Drawing Rights
  - I. Table A9.1 Summary of Recording of Positions/Transactions with the IMF (in the balance of payments/IIP)

### II.C Credit and loans from the IMF — scope and recording clarifications
- Scope updates:
  - Paragraph 7.79 will be updated to note that the sub-section covers IMF credit through non-concessional lending arrangements (Section I.A) and concessional lending arrangements (Section I.B), i.e., concessional loans ECF/SCF/RCF funded through the PRGT.
- Concessional lending grant element:
  - Following GN F.15, the grant element in the case of concessional lending will be recorded as supplementary information only.
- Paragraph movement:
  - Paragraph 7.81 will be moved to sub-section E (second bullet).

### II.D Debt relief through IMF‑managed trusts — classification and recording
- Cash grants from IMF trusts (e.g., CCR trust) to repay debt are classified as other capital transfers under the relevant sector (central bank or general government depending on the country situation).
- As the grant is provided for financing a balance of payments need, it should be recorded under memorandum items—exceptional financing (to the standard balance of payments presentation) under capital transfers.
- A short example based on Table 1 from the Special Series on COVID-19 Note "How to Record Debt Relief Under the Catastrophe Containment and Relief Trust in Macroeconomic Statistics" will be included to explain recording in the balance of payments.

### II.E Lending to the IMF and IMF‑managed trusts — reserve asset treatment
- Lending to the IMF:
  - When a member lends funds to the IMF as a participant in the NAB, or through bilateral loans/note purchase agreements, and if those claims are eligible for immediate early repayment to meet a balance of payments financing need, the member obtains a claim on the IMF that qualifies as a reserve asset and is included as part of the member’s reserve position in the IMF.
  - A member may extend credit or make loans to the IMF that are not part of the reserve position in the IMF—for example, where a member’s claim on the IMF is not immediately encashable at a time of balance of payments need (paragraph 7.81).
- Lending to IMF‑managed trust accounts (PRGT and RST):
  - If readily available to meet a balance of payments financing need, such lending should be included in official reserve assets and recorded as other claims/other reserve assets.
  - Claims on IMF‑managed trusts are not claims on the IMF and therefore are not to be included under reserve position in the IMF; reference to relevant paragraph in Chapter 6 will be provided.
  - Lending to IMF‑managed trusts that is not readily available to meet a balance of payments financing need does not qualify as official reserve assets and should be recorded under the appropriate functional category (most frequently, other investment).
- Recording guidance:
  - Further elaboration will be based on International Reserves and Foreign Currency Liquidity: Guidelines for a Data Template (IRFCL Guidelines) Appendix 8.

### II.H Special Drawing Rights (SDRs) — treatment and implications
- General treatment:
  - Sub-section will be mostly maintained as in BPM6 (paragraph 7.84) with updates.
- Net International Reserves (NIR):
  - The allocations of SDRs are recorded as debt liabilities and considered long-term reserve-related liabilities.
  - Therefore, they are not included in short-term foreign currency drains, implying that NIR—if following the BPM7 standard definition of NIR—would increase with the new SDR allocation.
  - Reference to relevant paragraphs on NIR from Chapter 6 will be provided.
- Centralized currency unions:
  - Statistical treatment of SDR allocations for countries that are members of a centralized currency union is provided in Annex 3.
- Review of documents:
  - The following documents will be reviewed further to incorporate additional updates as appropriate from the perspective of international accounts:
    - "Guidance Note for Fund Staff on the Treatment and use of SDR Allocations"
    - "How to Record the Allocations of Special Drawing Rights in Government Finance Statistics"
    - "Statistical Treatment of SDR Allocation: Frequently Asked Questions"

### II.I Table A9.1 — summary table of recording
- Table A9.1 will provide a summary recording of different lending/borrowing arrangements and SDRs in the balance of payments/IIP of the member economy.
- The table will be based on Table 8.1 of the IRFCL Guidelines.

### Schematic overview of Annex structure
- I Introduction
  - A. Non-Concessional Lending
  - B. Concessional Lending
  - C. Debt Relief
  - D. RST Lending
  - E. Fiscal Agency and Depository
- II Recording of Positions and Transactions with the IMF
  - A. Quotas
  - B. Reserve Position in the IMF
  - C. Credit and Loans from the IMF
  - D. Debt Relief Through IMF Managed Trusts
  - E. Lending to IMF and IMF Managed Trust Accounts
  - F. Remuneration
  - G. IMF No.2 Account
  - H. Special Drawing Rights
  - I. Table A9.1 Summary of Recording of Positions/Transactions with the IMF

### Key stakeholders consulted
- IMF Finance Department
- System of National Accounts Lead Editor
- IMF Statistics Department Financial Institutions Division and Government Finance Division

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_Source: https://www.imf.org/-/media/files/data/statistics/bmp7/chapters/ao-bpm-ann-9.pdf_