## BPM7 Chapter 5. Classifications of Financial Assets and Liabilities: Annotated Outline

## Source details

**Canonical URL:** [BPM7 Chapter 5. Classifications of Financial Assets and Liabilities: Annotated Outline](https://www.imf.org/-/media/files/data/statistics/bmp7/chapters/ao-bpm-ch-5.pdf)

## Other formats

- [Markdown version](/-/media/files/data/statistics/bmp7/chapters/ao-bpm-ch-5.pdf.md)
- [Structured JSON version](/-/media/files/data/statistics/bmp7/chapters/ao-bpm-ch-5.pdf.json)

---

### I. Introduction and scope
- Update to BPM6 Chapter 5: classifications of financial assets and liabilities in external sector statistics.
- Classifications apply to positions, associated income, financial account transactions, and other changes involving financial assets and liabilities.
- Separate sections proposed for:
  - Definition of assets and liabilities (Section II)
  - Classification by type of instrument (Section III)
  - Arrears (Section IV)
  - Classification by maturity (Section V)
  - Classification by currency (Section VI)
  - Classification by type of interest rate (Section VII)
- Consistency of language to be ensured across external sector statistics, System of National Accounts, Monetary and Financial Statistics, and Government Finance Statistics.
- A separate annex (new or referenced in Annex 11) will explain deviations from other macroeconomic statistics manuals where applicable.

### II. Definitions and special issues
- Assets and owners:
  - BPM6 definitions for assets and economic owner to be maintained.
- Financial instruments:
  - Financial instruments include assets and other financial instruments (contingent assets and liabilities) as defined in BPM6.
- Claims and liabilities:
  - Definition of a liability will be introduced; BPM6 definition of a claim and explanation about nonfinancial assets will be maintained.
- Financial assets:
  - BPM6 definition of a financial asset will be maintained.
- Contingent instruments:
  - BPM6 definition of contingent assets and liabilities to be maintained; explanation brief because contingent items (including provisions) are not generally recorded in external sector statistics.
  - Deviation from MFS (which records provisions in main accounts) will be noted in a footnote or annex.
- Other issues highlighted:
  - Crypto assets:
    - Definition of crypto assets and two categories (those with/without a corresponding liability).
    - Recording in relevant financial instruments or nonfinancial assets.
    - Link to digital assets framework and GN F.18 decision tree.
    - Further discussion in BPM7 Chapter 16 and Chapter 22 in 2025 SNA.
    - Clarification on residence treatment for crypto assets without corresponding liability to be provided in “Residence, institutional units and sectors” based on GN F.18.
  - Reference to BPM7 Chapter 17 on Islamic finance.
  - Negotiability (discussed in BPM6) to be addressed under debt securities in BPM7.

### III. Classification by type of instrument — main changes and clarifications
- Overall:
  - Maintain three broad categories from BPM6: equity, debt, and other.
- Equity and investment fund shares:
  - Equity:
    - Equity will include subscription rights; subscription rights recognized as equity (F.16).
    - “Other equity” to be renamed “equity in international organizations and other equity” to record capital subscriptions to international organizations comprehensively (B.12).
    - Reserve position in the IMF is recorded as reserve assets, not in other equity.
  - Investment fund shares or units treated as a separate subsection.
- Debt instruments:
  - Special Drawing Rights (SDR) treated as a debt instrument category.
  - Currency and deposits:
    - Central bank swap arrangements that do not have characteristics of a standard (market priced) contract are recorded as exchanges of deposits between central banks with obligation to unwind at a fixed exchange rate on a specified date; the deposit is denominated in domestic currency but treated as denominated in foreign currency.
    - Central bank swaps with a standard (market priced) contract recorded as standard currency swaps (BOPCOM Clarification Note 5).
    - Margins and cash collaterals (e.g., for financial derivatives) — recording to be added in accordance with F.10 (to be approved).
    - Currency includes central bank digital currencies (F.18).
    - Deposits include electronic money when they are liabilities of deposit-taking corporations; for non-deposit taking corporations, apply current BPM6 and 2008 SNA treatment (either deposits or other instruments).
  - Debt securities: structure and definitions maintained.
  - Loans:
    - Introduce supplementary item under loans “of which: repurchase agreements, securities lending with cash collateral, and margin lending” (F.1, F.3, and F.6).
    - Margins and cash collateral recording to be added in accordance with F.10 (to be approved).
    - Clarification of specific interbank loan positions (e.g., overdrafts in nostro/vostro accounts and cash collateral for repos).
    - Factoring:
      - Factoring claim against the debtor treated as a loan and factoring income as a fee paid by the supplier.
      - Recourse factoring treated the same as non-recourse factoring.
      - Instrument reclassification from trade credit to a loan (for the original borrower) treated as a transaction in the financial account.
      - Conceptual ideal for discount earned by the factor versus convention (treatment as a fee) to be mentioned.
  - Insurance, pension, and standardized guarantee schemes:
    - Hybrid insurance products allocated to life or nonlife insurance depending on predominant features (F.12).
    - Autonomous employer-independent schemes or funds can qualify as social insurance pensions if accumulated contributions are set aside for retirement income and subject to regulation or supervision similar to employer-related pension schemes/funds (F.12).
    - Reference to IF.1 / chapter 17 (e.g., Takaful and Re-takaful arrangements) to be added; keep reference to Appendix on insurance, pension schemes, and standardized guarantees.
  - Other accounts receivable/payable:
    - Margins and cash collaterals recording to be added in accordance with F.10 (to be approved).
    - Note: Some items classified as deposits in BPM6/2008 SNA but as loans in MFS; BPM/SNA could adopt MFS classification where banks can identify loans and deposits separately.
- Other financial assets and liabilities:
  - Monetary gold:
    - BPM6 paragraph 5.76 updated to include pool allocated gold accounts; pool allocated gold accounts to be treated similar to allocated gold accounts (i.e., classified as monetary gold, when held as reserve assets).
  - Financial derivatives and employee stock options:
    - Financial derivatives to be classified by risk category as standard components (by instrument and by trading venue and clearing status as supplementary items).
    - Emphasize compiling notional values of foreign currency financial derivatives for Table A9-I-1b and 2b of BPM6 (market/fair values remain primary valuation method for BOP and IIP) (F.4).
    - Clarify classifying credit default swaps (CDS) as an option-type contract although they have some forward-type characteristics; CDS primarily classified by risk category (i.e., credit derivatives) in BPM7 (F.4).
  - Structures and definitions from BPM6 in remaining subsections to be maintained.

### IV. Arrears
- Arrears section structure from BPM6 to be maintained; relevant clarifications and treatments to be included consistent with overall updates.

### V. Classification by maturity
- Clarification on definition of remaining maturity:
  - Use of debt payments as the basis for remaining maturity classification in line with BOPCOM Clarification Note 2 and the 2013 External Debt Statistics Guide.

### VI. Classification by currency
- Classification by currency section to be retained; include references to central bank digital currencies (F.18) and treatment of instruments denominated in foreign currency (e.g., central bank deposit treatment under swaps).

### VII. Classification by type of interest rate
- Section structure from BPM6 to be maintained; classification by fixed/variable or other interest rate types to be clarified consistent with other updates.

### Schematic structure (maintained from BPM6)
- I. Introduction
- II. Definition of Assets and Liabilities
  - A. Assets in general
  - B. Financial instruments
  - C. Claims
  - D. Financial assets
  - E. Other financial instruments not recognized as financial assets
  - F. Other issues
- III. Classification of Financial Assets and Liabilities by Type of Instrument
  - A. Introduction to classification of particular financial assets and liabilities
  - B. Equity and investment fund shares
    - 1. Equity
    - 2. Investment fund shares
  - C. Debt instruments
    - 1. Special Drawing Rights
    - 2. Currency and deposits
    - 3. Debt securities
    - 4. Loans
    - 5. Insurance, pension, and standardized guarantee scheme
    - 6. Other accounts receivable/payable
  - D. Other financial assets and liabilities
    - 1. Monetary gold
    - 2. Financial derivatives and employee stock options
- IV. Arrears
- V. Classification by Maturity
- VI. Classification by Currency
- VII. Classification by Type of Interest Rate

### References and consulted stakeholders
- Guidance notes referenced: GNs B.12, C.5, F.1, F.3, F.4, F.5, F.6, F.7, F.10, F.12, F.14, F.18, IF.1.
- Other manuals referenced: Monetary and Financial Statistics Manual and Compilation Guide; Handbook on Securities Statistics.
- Key stakeholders consulted:
  - System of National Account and Balance of Payments Manual editors
  - IMF Statistics Department Financial Institutions Division and Government Finance Division

---


_Source: https://www.imf.org/-/media/files/data/statistics/bmp7/chapters/ao-bpm-ch-5.pdf_