## pr214-signed-finland-2020-borrowing-agreements - 1. Purposes and Amounts

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### Purposes and scope
- Objective: enhance resources available on a temporary basis to the International Monetary Fund (the "Fund") for crisis prevention and resolution through bilateral borrowing.
- Loan Amount: an SDR-denominated amount up to the equivalent of EUR 3,760 million (the "Loan Amount").
- Rolled Back Loan Amount: upon effectiveness of the increase in Finland's NAB credit arrangement under the NAB Reform, the Loan Amount will be automatically reduced to an SDR-denominated amount up to the equivalent of EUR 1,620 million (the "Rolled Back Loan Amount").
- Legal basis: Article Vll, Section 1(i) of the Fund's Articles of Agreement; considered with the Guidelines for Borrowing by the Fund.
- Terminology:
  - This agreement and other similar agreements under the March 2020 framework: "2020 Borrowing Agreement(s)" and collectively the "2020 Borrowing Agreements".
  - Bilateral borrowing agreements under the August 2016 framework: "2016 Borrowing Agreement(s)" and collectively the "2016 Borrowing Agreements".
  - Together: the "Bilateral Borrowing Agreements".

### Term, activation, use, and coordination
- Term and extension:
  - Term ends on December 31,2023.
  - Fund may extend the term for one further year through December 31, 2024 by Executive Board decision and with the consent of the Bank of Finland.
- Activation conditions (paragraph 2(b)):
  - 2020 Borrowing Agreements may be activated only after the Managing Director has notified the Executive Board that the Fund's modified FCC is below SDR 100 billion (the "activation threshold"); provided that:
    - (i) the NAB is activated as of the notification time, or there are no available uncommitted resources under the NAB as of that time, and
    - (ii) activation has been approved by creditors representing at least 85 percent of the total credit amount committed under the 2020 Borrowing Agreements by creditors eligible to vote.
  - Eligibility to vote: a creditor is ineligible if, at vote time, its 2020 Borrowing Agreement is not effective, or the relevant member is not included in the Fund's Financial Transactions Plan for transfers of its currency.
  - Managing Director may approach creditors earlier if extraordinary circumstances warrant.
- Deactivation and reactivation (paragraph 2(c)):
  - Automatic deactivation whenever the NAB is no longer activated, unless there are no available uncommitted resources under the NAB at that time.
  - Deactivation also occurs if the Managing Director notifies that the modified FCC (excluding Bilateral Borrowing Agreements) has risen above the activation threshold and:
    - (i) the Executive Board determines activation is no longer necessary; or
    - (ii) six months elapse from the notification without the modified FCC (excluding Bilateral Borrowing Agreements) falling below the activation threshold.
  - If after deactivation the modified FCC falls below the activation threshold, paragraph 2(b) provisions apply.
- Permitted uses during activation (paragraph 2(d)):
  - While activated, the Fund may:
    - (i) use resources under this agreement to fund any outright purchases made from the GRA during the term of this agreement; and
    - (ii) approve, during the term, commitments of GRA resources whose purchases could be funded by drawings under this agreement at any time during the period of such commitments, including after expiration or deactivation; commitments covered under (ii) include any commitment whose approval caused the activation threshold to be reached.
- Funding early repayments of other 2020 Borrowing Agreements (paragraph 2(e)):
  - After activation, resources may fund early repayment of claims under other 2020 Borrowing Agreements if relevant creditors request early repayment as specified in paragraph 8.
  - Drawings for such early repayment may be made for as long as claims under the 2020 Borrowing Agreements remain outstanding, including after expiration or during periods when this agreement is not activated.

### Drawing objectives and planning (paragraph 3)
- Drawing goal:
  - Drawings shall be made with the goal of achieving over time broadly balanced positions among creditors under all Bilateral Borrowing Agreements relative to their commitments.
- Estimates and restrictions (paragraph 3(a)):
  - Prior to each plan period, the Fund shall provide the Bank of Finland its best estimates of amounts expected to be drawn under this agreement for the forthcoming period and revised estimates as warranted.
  - The Bank of Finland shall not be included in the periodic plan, and no drawings shall be made under this agreement, if Finland is not included and is not being proposed to be included in the Financial Transactions Plan for transfers of its currency.
  - No drawings if Bank of Finland was included in the periodic plan but Finland's currency is not being used in transfers under the Financial Transactions Plan because of Finland's balance of payments and reserve position.
  - If Finland was not included at activation vote and is subsequently included, drawings may be made to fund purchases and commitments approved during the activation period unless the Bank of Finland notifies the Fund it does not wish to be drawn upon.
- Notice requirements for drawings (paragraph 3(b)):
  - Fund shall give the Bank of Finland at least five business days' (Helsinki) notice of intention to draw.
  - Payment instructions at least two business days (Fund) prior to value date by rapid authenticated means of communication (e.g., SWFT).
  - In exceptional circumstances where at least five business days' notice is not possible, notification at least three business days (Helsinki) in advance; Bank of Finland to make best efforts to meet such a call.

### Evidence of indebtedness (paragraph 4)
- Publication and instruments:
  - Outstanding drawings will be included in the statements of Finland's position in the Fund published monthly by the Fund.
  - At Bank of Finland request, Fund shall issue non-negotiable instruments evidencing indebtedness arising under this agreement.
  - Upon repayment of an instrument and accrued interest, the instrument is returned to the Fund for cancellation; if repaid in part, returned and a new instrument for the remainder substituted with same maturity date.

### Maturity, repayment, and extensions (paragraph 5)
- Standard maturity:
  - Each drawing shall have a maturity date of three months from the drawing date, except as otherwise provided.
- Extension election and automatic extension:
  - The Fund may elect to extend maturity by additional three-month periods after initial maturity.
  - The Fund is automatically deemed to have elected such extension for all drawings unless it notifies the Bank of Finland at least five business days (Fund) before a maturity date that it does not elect extension for a particular drawing or portion.
- Limits on extension:
  - (i) Maturity for any drawing to fund GRA purchases shall not be extended later than the tenth anniversary of the drawing date.
  - (ii) Maturity for drawings to fund early repayments of other creditors' claims pursuant to paragraph 2(e) shall be a single common maturity date equal to the longest remaining maximum maturity of any claim for which early repayment was requested or the tenth anniversary of the drawing date, whichever is earlier.
  - Notwithstanding preceding deadlines, following an Executive Board determination of exceptional circumstances due to a shortage of Fund resources in relation to obligations falling due, the Fund, with Bank of Finland agreement, may extend maximum maturity for drawings under this agreement up to an additional five years.
- Repayment mechanics:
  - Fund shall repay principal on the maturity date applicable to that drawing.
  - After consultation, Fund may make early repayment in part or in full prior to maturity, provided it notifies Bank of Finland at least five business days (Fund) before such repayment by rapid authenticated means.
  - Repayments restore pro tanto the amount that can be drawn; extension of maturity does not reduce the amount that can be drawn.
  - If a maturity date is not a business day at the place of payment, payment date will be the next business day and interest will accrue up to the payment date.

### Interest, denomination, and payment modalities (paragraphs 6 and 7)
- Interest rate (paragraph 6):
  - Each drawing shall bear interest at the SDR interest rate established by the Fund pursuant to Article XX, Section 3 of the Fund's Articles of Agreement.
  - If the Fund pays an interest rate higher than the SDR interest rate on outstanding balances from any other borrowing on comparable terms effected pursuant to Article Vll, Section 1(i), for as long as that higher rate remains in effect, the interest rate payable on drawings under this agreement shall be equivalent to that higher interest rate.
  - Interest is calculated on the outstanding amount, accrues daily, and shall be paid promptly by the Fund after each July 31, October 31, January 31, and April 30.
- Denomination and modalities (paragraph 7):
  - Drawings and corresponding repayments shall be denominated in SDRs.
  - Unless otherwise agreed, each drawing shall be paid by the Bank of Finland on the value date by transfer of the SDR equivalent amount of euro to the Fund's account at the designated depository of Finland.
  - For drawings made to fund early repayments under paragraph 2(e), the Bank of Finland shall ensure that balances drawn by the Fund that are not balances of a freely usable currency can be exchanged for a freely usable currency of its choice, and for balances that are freely usable currencies shall collaborate with the Fund and other members to enable exchange for another freely usable currency.
  - Repayment of principal shall be made, as determined by the Fund, in the currency borrowed whenever feasible, in euro, in special drawing rights (subject to Article XlX, Section 4 limits unless Finland agrees), in freely usable currencies, or with Bank of Finland agreement in other currencies included in the Fund's Financial Transactions Plan for transfers.
  - Interest payments shall normally be made in SDRs; Fund and Bank of Finland may agree interest payments in euro.
  - Payments in euro shall be made to an account specified by the Bank of Finland. Payments in SDRs shall be made by crediting Finland's account in the Special Drawing Rights Department. Payments in any other currency shall be made to an account specified by the Bank of Finland.

### Early repayment at request of Bank of Finland (paragraph 8)
- Conditions for Bank of Finland to request early repayment at face value:
  - (i) Bank of Finland represents that Finland's balance of payments and reserve position justifies such repayment, and
  - (ii) Fund, giving the representation the overwhelming benefit of any doubt, determines that there is a need for the early repayment as requested in light of Finland's balance of payments and reserve position.
- After consultation, Fund may make repayments pursuant to this paragraph in SDRs or a freely usable currency as determined by the Fund or, with Bank of Finland agreement, in currencies of other members included in the Fund's Financial Transactions Plan for transfers.

### Transferability (paragraph 9, partial) and business references
- General rule:
  - Bank of Finland may not transfer its obligations or claims resulting from outstanding drawings except with prior consent of the Fund and on terms the Fund may approve, except as provided in subparagraphs (b) through (h).
- Permitted transfers (paragraph 9(b)):
  - Bank of Finland may transfer all or part of any claim on the Fund resulting from outstanding drawings to:
    - any member of the Fund,
    - the central bank or other fiscal agency designated by any member for Article V, Section 1 purposes ("other fiscal agency"), or
    - any official entity prescribed as a holder of SDRs pursuant to Article XVll, Section 3.
- Conditions on transferees (paragraph 9(c)):
  - Transferee shall assume Bank of Finland's liability pursuant to paragraph 5(a) regarding extension of maturities and exceptional extensions.
  - Transferred claims held on same terms except:
    - (i) transferee acquires right to request early repayment under paragraph 8 only if it is a member, or central bank or fiscal agency of a member, and at transfer time the member's balance of payments and reserve position is considered sufficiently strong for its currency to be used in transfers under the Financial Transactions Plan,
    - (ii) if transferee is a member or its central bank/fiscal agency, the reference to euro in paragraph 7 shall be deemed to refer to the relevant member's currency; otherwise deemed to refer to a freely usable currency determined by the Fund,
    - (iii) payments related to the transferred claim shall be made to an account specified by the transferee,
    - (iv) [text truncated in source beyond this point].
- Transfers, pricing, notification, and effectiveness (business references):
  - Business days refer to business days in the place where the transferee is situated.
  - Price of a claim transferred pursuant to subparagraph (b) shall be as agreed between Bank of Finland and transferee.
  - Bank of Finland shall notify the Fund promptly of the claim being transferred, transferee name, amount, agreed price, and value date.
  - A transfer notified under subparagraph (e) shall be reflected in Fund records if in accordance with paragraph 9 terms and conditions.
  - Transfer is effective as of the agreed value date.
  - If a claim is transferred during a quarterly period as described in paragraph 6(b), the Fund shall pay interest to the transferee on the amount transferred for the whole of that period.
  - If requested, the Fund shall assist in seeking to arrange transfers.

### Effective exchange rate, valuation, and SDR method changes
- Exchange rate determination:
  - Unless otherwise agreed, all drawings, exchanges, and payments shall be made at exchange rates for relevant currencies in terms of the SDR established pursuant to Article XlX, Section 7(a) for the second business day of the Fund before the value date of the transfer, exchange or payment.
  - If that exchange rate determination date is not a business day in Helsinki, such date shall be the last preceding business day of the Fund that is also a business day in Helsinki.
- Euro value fixation for limits:
  - For applying the limit on drawings specified in paragraphs 1(a), 14(c) and 14(e), the euro value of each SDR-denominated drawing shall be determined and permanently fixed on the value date of the drawing based on the euro/SDR exchange rate established pursuant to Article XlX, Section 7(a) for the second business day of the Fund before the value date.
  - If that exchange rate determination date is not a business day in Helsinki, such date shall be the last preceding business day of the Fund that is also a business day in Helsinki.
- Changes in method of valuation of SDR:
  - If the Fund changes the method of valuing the SDR, all transfers, exchanges and payments of principal and interest made two or more business days of the Fund after the effective date of the change shall be made on the basis of the new method.

### Non-subordination, settlement, and transitional arrangements (paragraph 14)
- Non-subordination:
  - Fund agrees it will not take any action that would have the effect of making Bank of Finland's claims under this agreement subordinate to claims resulting from any other borrowing effected pursuant to Article Vll, Section 1(i).
- Settlement of questions:
  - Any question arising under this agreement shall be settled by mutual agreement between the Bank of Finland and the Fund.
- Transitional arrangements (paragraph 14):
  - Regardless of activation status, Fund:
    - (i) subject to paragraph 14(b), shall make drawings under this agreement to repay any outstanding claims under Bank of Finland's 2016 Borrowing Agreement, and
    - (ii) may make drawings to fund purchases under commitments approved during an activation of the 2016 Borrowing Agreements or to fund early repayment of claims under other 2016 Borrowing Agreements if the creditor represents a balance of payments need;
    - provided that the maximum maturity date of the claim from the repayment shall be the residual maximum maturity date of the repaid claim.
  - Claims arising from such repayment shall be considered claims under the 2016 Borrowing Agreements for purposes of early repayment in case of balance of payments need under the 2016 Borrowing Agreements, and for purposes of special calls under paragraph 23 of Fund Decision No. 16645-(20/5), adopted January 16,2020.
- NAB credit arrangement interaction:
  - To the extent claims under the 2016 Borrowing Agreement or this agreement are outstanding when the increase in Finland's NAB credit arrangement becomes effective, Bank of Finland shall be deemed to request, on behalf of Finland, that the Managing Director make calls under Finland's NAB credit arrangement up to the maximum available amount, taking into account the Fund's need for maintaining prudential balances, to fund repayment of such claims;
    - provided that if the increase in Finland's NAB credit arrangement and this agreement enter into effect at the same time, repayment of Bank of Finland's outstanding claims under the 2016 Borrowing Agreement shall be funded first with calls under Finland's NAB credit arrangement before drawings under this agreement pursuant to paragraph 14(a).
- Excess claims and repayment order:
  - If after repayment as provided in paragraph 14(b) Bank of Finland's outstanding claims remain in excess of the Rolled Back Loan Amount as calculated pursuant to paragraph 10(b), the Fund shall repay any outstanding claims under the 2016 Borrowing Agreement and this agreement in excess of the Rolled Back Loan Amount;
    - provided that claims with shorter remaining maximum maturities shall be repaid before those with longer remaining maximum maturities.
- Cessation of 2016 Agreement drawings:
  - After entry into force of this agreement, the Fund may make no further drawing under Bank of Finland's 2016 Borrowing Agreement.
- Drawing limits relative to Loan Amount and Rolled Back Loan Amount:
  - No drawing shall be made that would cause total outstanding drawings under both this agreement and the 2016 Borrowing Agreement to:
    - (i) exceed the Loan Amount prior to effectiveness of the increase in Finland's NAB credit arrangement, or
    - (ii) exceed the Rolled Back Loan Amount upon and after effectiveness of the increase in Finland's NAB credit arrangement, as calculated pursuant to paragraph l0(b);
    - provided that drawings beyond the Rolled Back Loan Amount under (ii) are authorized if within the same day any resulting claim that would exceed the Rolled Back Loan Amount is repaid with a special call under Finland's NAB credit arrangement, and Bank of Finland hereby requests, on behalf of Finland, that the Managing Director make such calls to fund the repayment in accordance with paragraph 23 of Fund Decision No. 11428-(97/6), adopted January 27,1997 on the NAB, as amended.

### Final provisions and execution
- Execution and effectiveness:
  - Agreement may be executed in duplicate counterparts, each deemed an original; both together constitute one instrument.
  - Effective on the date last signed below or on the date Finland provides the concurrence required under Article Vll, Section 1(i) for Fund borrowing of euro from the Bank of Finland, or on January 1, 2021, whichever is later.
- Signatures:
  - For the Bank of Finland: Honorable Olli Rehn, Governor.
  - For the International Monetary Fund: Kristalina Georgieva, Managing Director.
  - Date shown: 12/21/2020.

*Source: pr214-signed-finland-2020-borrowing-agreements (PDF).*

### 1. Purposes and

### pr214-signed-finland-2020-borrowing-agreements - 1. Purposes and Amounts

### Purposes and scope
- To enhance the resources available on a temporary basis to the lnternational Monetary Fund (the "Fund") for crisis prevention and resolution through bilateral borrowing, the Bank of Finland agrees to lend to the Fund an SDR-denominated amount up to the equivalent of EUR 3,760 million (the "Loan Amount"); provided however that, upon the effectiveness of the increase in Finland's credit arrangement under the Fund's New Arrangements to Borrow (the "NAB") as part of the reform of the NAB approved by the Fund under Decision No. 16645-(2015), adopted January 16,2020 (the "NAB Reform"), the Loan Amount will be automatically reduced to an SDR-denominated amount up to the equivalent of EUR 1,620 million (the "Rolled Back Loan Amount").
- The agreement is based on Article Vll, Section 1(i) of the Fund's Articles of Agreement and must be considered in light of the Guidelines for Borrowing by the Fund, which state that quota subscriptions remain the basic source of Fund financing and borrowing provides a temporary supplement to quota resources.
- Terminology:
  - This agreement and other bilateral borrowing agreements entered into or amended pursuant to the borrowing framework approved by the Fund in March 2020 are each a "2020 Borrowing Agreement" and collectively the "2020 Borrowing Agreements".
  - Bilateral borrowing agreements entered into pursuant to the borrowing framework approved by the Fund in August 2016 are "2016 Borrowing Agreement(s)" and collectively the "2016 Borrowing Agreements".
  - The 2020 Borrowing Agreements and the 2016 Borrowing Agreements together are the "Bilateral Borrowing Agreements".

### Term, activation, use, and coordination
- Term and extension:
  - The term of this agreement shall end on December 31,2023; provided that the Fund may extend the term of this agreement for one further year through December 31, 2024 by a decision of the Executive Board, taking into account the Fund's overall liquidity situation and actual and prospective borrowing requirements, and with the consent of the Bank of Finland.
- Activation conditions (paragraph 2(b)):
  - The 2020 Borrowing Agreements may be activated only after the Managing Director has notified the Executive Board that the Fon¡¡ard Commitment Capacity of the Fund as defined in Decision No. 14906-(11l38), adopted April 20, 2011, taking into account all available uncommitted resources under the NAB (the "modified FCC"), is below SDR 100 billion (the "activation threshold"); provided, however, that the Managing Director shall not provide such notification unless:
    - (i) the NAB is 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 2020 Borrowing Agreements has been approved by creditors representing at least 85 percent of the total credit amount committed under the 2020 Borrowing Agreements by creditors eligible to vote on such activation.
  - For the poll of eligible creditors the Managing Director shall propose in writing the activation and request the creditors' vote. A creditor shall not be eligible to vote on the activation if, at the time of the vote, its 2020 Borrowing Agreement is not effective, or the relevant member is not included in the Fund's Financial Transactions Plan for transfers of its currency.
  - Nothing precludes the Managing Director from approaching creditors before the modified FCC is below the activation threshold if extraordinary circumstances warrant.
- Deactivation and reactivation (paragraph 2(c)):
  - If activated, the 2020 Borrowing Agreements shall be automatically deactivated whenever the NAB is no longer activated, unless there are no available uncommitted resources under the NAB at that time.
  - Separately, the 2020 Borrowing Agreements shall be deactivated if the Managing Director has notified the Executive Board that the modified FCC (excluding 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 Managing Director's notification and, within that period, the modified FCC (excluding amounts available under the Bilateral Borrowing Agreements) has not fallen below the activation threshold.
  - If, after deactivation, the modified FCC falls below the activation threshold, paragraph 2(b) provisions will apply.
- Permitted uses during activation (paragraph 2(d)):
  - While activated, the Fund may:
    - (i) use resources under this agreement to fund any outright purchases made from the GRA during the term of this agreement; and
    - (ii) approve, during the term of this agreement, commitments of GRA resources under Fund arrangements whose purchases could be funded by drawings under this agreement at any time during the period of such commitments, including after the expiration of the term of this agreement and during any period in which this agreement is no longer activated in accordance with paragraph 2(c); provided that the commitments covered under clause (ii) shall also include any commitment whose approval caused the activation threshold to be reached.
- Funding early repayments of other 2020 Borrowing Agreements (paragraph 2(e)):
  - Following activation, resources under this agreement may be used to fund early repayment of claims under other 2020 Borrowing Agreements if relevant creditors request early repayment as specified in paragraph 8. Drawings may be made for such early repayment for as long as claims under the 2020 Borrowing Agreements remain outstanding, including after expiration of the term or during any period when this agreement is not activated.

### Drawing objectives and planning (paragraph 3)
- Goal for drawings:
  - Drawings under this agreement shall be made with the goal of achieving over time broadly balanced positions among creditors under all Bilateral Borrowing Agreements relative to their commitments under these agreements.
- Estimates and restrictions (paragraph 3(a)):
  - Prior to each plan period for use of bilateral borrowed resources, the Fund shall provide the Bank of Finland with its best estimates of amounts expected to be drawn under this agreement during the forthcoming period and shall provide revised estimates as warranted.
  - The Bank of Finland shall not be included in the periodic plan, and no drawings shall be made under this agreement, if Finland 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.
  - No drawings shall be made if the Bank of Finland was included in the periodic plan but, at the time of drawing, Finland's currency is not being used in transfers under the Financial Transactions Plan because of Finland's balance of payments and reserve position.
  - If Finland was not included in the Financial Transactions Plan at the time of the vote on activation and is subsequently included, drawings may be made to fund purchases made and commitments approved during the activation period unless the Bank of Finland notifies the Fund it does not wish to be drawn upon.
- Notice requirements for drawings (paragraph 3(b)):
  - The Fund shall give the Bank of Finland at least five business days' (Helsinki) notice of its intention to draw, and shall provide payment instructions at least two business days (Fund) prior to the value date by a rapid authenticated means of communication (e.g., SWFT).
  - In exceptional circumstances where at least five business days' (Helsinki) notice is not possible, notification would be made at least three business days (Helsinki) in advance of the value date, and the Bank of Finland would make best efforts to meet such a call.

### Evidence of indebtedness (paragraph 4)
- Publication and instruments:
  - Outstanding drawings under this agreement will be included in the statements of Finland's position in the Fund that are published monthly by the Fund.
  - At the request of the Bank of Finland, the Fund shall issue non-negotiable instruments evidencing the Fund's indebtedness to the Bank of Finland arising under this agreement. Upon repayment of the amount of any instrument and all accrued interest, the instrument shall be returned to the Fund for cancellation. If less than the amount is repaid, the instrument shall be returned and a new instrument for the remainder shall be substituted with the same maturity date.

### Maturity, repayment, and extensions (paragraph 5)
- Standard maturity:
  - Except as otherwise provided, each drawing shall have a maturity date of three months from the drawing date.
- Extension election and automatic extension:
  - The Fund may elect in its sole discretion to extend the maturity date of any drawing or portion thereof by additional periods of three months after the initial maturity date. The Fund shall automatically be deemed to have elected such extension with respect to all drawings then outstanding unless, at least five business days (Fund) before a maturity date, the Fund notifies the Bank of Finland by rapid authenticated means of communication (e.g., SWFT) that it does not elect to extend the maturity date of a particular drawing or portion thereof.
- Limits on extension:
  - (i) The maturity date of any drawing to fund purchases from the GRA shall not be extended to a date later than the tenth anniversary of the date of such drawing.
  - (ii) The maturity date for any drawings to fund early repayments of other creditors' claims in accordance with paragraph 2(e) shall be a single common maturity date that is the longest remaining maximum maturity of any claim for which such early repayment has been requested or the tenth anniversary of the date of the relevant drawing to fund early repayment, whichever is earlier.
  - Notwithstanding preceding maturity deadlines, following an Executive Board determination that exceptional circumstances exist as a result of a shortage of Fund resources in relation to Fund obligations falling due, the Fund, with the agreement of the Bank of Finland, may extend the maximum maturity for drawings under this agreement up to an additional five years.
- Repayment mechanics:
  - The Fund shall repay principal on the maturity date applicable to that drawing (subparagraph (b)).
  - After consultation with the Bank of Finland, the Fund may make an early repayment in part or in full prior to maturity, provided the Fund notifies the Bank of Finland at least five business days (Fund) before such repayment by rapid authenticated means (subparagraph (c)).
  - Repayments restore pro tanto the amount that can be drawn under this agreement; extension of maturity does not reduce the amount that can be drawn (subparagraph (d)).
  - If a maturity date is not a business day at the place of payment, payment date will be the next business day and interest will accrue up to the payment date (subparagraph (e)).

### Interest, denomination, and payment modalities (paragraphs 6 and 7)
- Interest rate (paragraph 6):
  - Each drawing shall bear interest at the SDR interest rate established by the Fund pursuant to Article XX, Section 3 of the Fund's Articles of Agreement; provided however that, if the Fund pays an interest rate higher than the SDR interest rate on outstanding balances from any other borrowing on comparable terms effected pursuant to Article Vll, Section 1(i) of the Fund's Articles of Agreement, and for as long as the payment of such higher interest rate remains in effect, the interest rate payable on drawings under this agreement shall be equivalent to the interest rate paid by the Fund on such other comparable borrowing.
  - Interest is calculated on the outstanding amount, accrues daily, and shall be paid promptly by the Fund after each July 31, October 31, January 31, and April 30.
- Denomination and modalities (paragraph 7):
  - Drawings and corresponding repayments shall be denominated in SDRs.
  - Unless otherwise agreed, each drawing shall be paid by the Bank of Finland on the value date by transfer of the SDR equivalent amount of euro to the Fund's account at the designated depository of Finland; provided that for drawings made to fund early repayments under paragraph 2(e), the Bank of Finland shall ensure that balances drawn by the Fund that are not balances of a freely usable currency can be exchanged for a freely usable currency of its choice, and with respect to balances 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.
  - Repayment of principal shall be made, as determined by the Fund, in the currency borrowed whenever feasible, in euro, in special drawing rights (subject to Article XlX, Section 4 limits unless Finland agrees), in freely usable currencies, or with the Bank of Finland's agreement in other currencies included in the Fund's Financial Transactions Plan for transfers.
  - Interest payments shall normally be made in SDRs; the Fund and Bank of Finland may agree interest payments in euro.
  - Payments in euro shall be made to an account specified by the Bank of Finland. Payments in SDRs shall be made by crediting Finland's account in the Special Drawing Rights Department. Payments in any other currency shall be made to an account specified by the Bank of Finland.

### Early repayment at request of Bank of Finland (paragraph 8)
- Early repayment at face value at the Bank of Finland's request:
  - The Bank of Finland may obtain early repayment at face value of all or a portion of drawings outstanding under this agreement if:
    - (i) the Bank of Finland represents that Finland's balance of payments and reserve position justifies such repayment, and
    - (ii) the Fund, giving the representation the overwhelming benefit of any doubt, determines that there is a need for the early repayment as requested in light of Finland's balance of payments and reserve position.
  - After consultation, the Fund may make repayments pursuant to this paragraph in SDRs or a freely usable currency as determined by the Fund or, with the Bank of Finland's agreement, in currencies of other members included in the Fund's Financial Transactions Plan for transfers.

### Transferability (paragraph 9, partial)
- General rule:
  - Except as provided in subparagraphs (b) through (h), the Bank of Finland may not transfer its obligations under this agreement or any of its claims on the Fund resulting from outstanding drawings except with the prior consent of the Fund and on terms the Fund may approve.
- Permitted transfers (paragraph 9(b) and related conditions):
  - The Bank of Finland may transfer at any time all or part of any claim on the Fund resulting from outstanding drawings to:
    - any member of the Fund,
    - the central bank or other fiscal agency designated by any member for purposes of Article V, Section 1 of the Fund's Articles of Agreement ("other fiscal agency"), or
    - any official entity prescribed as a holder of SDRs pursuant to Article XVll, Section 3 of the Fund's Articles of Agreement.
  - Conditions on transferees (paragraph 9(c)):
    - As a condition of transfer, the transferee shall assume the liability of the Bank of Finland pursuant to paragraph 5(a) regarding extension of maturities and exceptional extensions of maximum maturity.
    - Transferred claims shall be held by the transferee on the same terms and conditions as held by the Bank of Finland, except:
      - (i) the transferee acquires the right to request early repayment under paragraph 8 only if it is a member, or central bank or other fiscal agency of a member, and at transfer time the member's balance of payments and reserve position is considered sufficiently strong in the Fund's opinion that its currency is used in transfers under the Financial Transactions Plan,
      - (ii) if the transferee is a member, or the central bank or other fiscal agency of a member, the reference to euro in paragraph 7 shall be deemed to refer to the currency of the relevant member, and in other cases it shall be deemed to refer to a freely usable currency determined by the Fund,
      - (iii) payments related to the transferred claim shall be made to an account specified by the transferee,
      - (iv) [text truncated in source beyond this point].

*Source: pr214-signed-finland-2020-borrowing-agreements (PDF) — https://www.imf.org/-/media/files/news/press-release/2021/pr214/pr214-signed-finland-2020-borrowing-agreements.pdf*

### references to business

### pr214-signed-finland-2020-borrowing-agreements - references to business

### Transfers, pricing, notification, and effectiveness
- Transfers of claims:
  - Business days shall be deemed to refer to business days in the place where the transferee is situated.
  - The price of a claim transferred pursuant to subparagraph (b) shall be as agreed between the Bank of Finland and the transferee.
  - The Bank of Finland shall notify the Fund promptly of the claim that is being transferred pursuant to subparagraph (b), 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.
  - A transfer notified to the Fund under subparagraph (e) shall be reflected in the Fund's records if it is in accordance with the terms and conditions of this paragraph g.
  - The transfer shall be effective as of the value date agreed between the Bank of Finland and the transferee.
  - If all or part of a claim is transferred during a quarterly period as described in paragraph 6(b), the Fund shall pay interest to the transferee on the amount of the claim transferred for the whole of that period.
  - If requested, the Fund shall assist in seeking to arrange transfers.

### Effective exchange rate and drawing valuation
- Exchange rate determination:
  - Unless otherwise agreed between the Bank of Finland and the Fund, all drawings, exchanges, and payments of principal and interest under this agreement shall be made at the exchange rates for the relevant currencies in terms of the SDR established pursuant to Article XlX, Section 7(a) of the Fund's Articles of Agreement and the rules and regulations of the Fund thereunder for the second business day of the Fund before the value date of the transfer, exchange or payment.
  - If this exchange rate determination date is not a business day in Helsinki, such date shall be the last preceding business day of the Fund that is also a business day in Helsinki.
- Determination and fixation of euro value for limits:
  - For purposes of applying the limit on drawings as specified in paragraphs 1(a), 14(c) and 14(e), the euro value of each SDR-denominated drawing shall be determined and permanently fixed on the value date of the drawing based on the euro/SDR exchange rate established pursuant to Article XlX, Section 7(a) of the Fund's Articles of Agreement and the rules and regulations of the Fund thereunder for the second business day of the Fund before the value date of the drawing.
  - If this exchange rate determination date is not a business day in Helsinki, such date shall be the last preceding business day of the Fund that is also a business day in Helsinki.

### Changes in method of valuation of SDR
- If the Fund changes the method of valuing the SDR, all transfers, exchanges and payments of principal and interest made two or more business days of the Fund after the effective date of the change shall be made on the basis of the new method of valuation.

### Non-subordination of claims
- The Fund agrees that it will not take any action that would have the effect of making the Bank of Finland's claims on the Fund resulting from outstanding drawings under this agreement subordinate in any way to claims on the Fund resulting from any other borrowing effected pursuant to Article Vll, Section 1(i) of the Fund's Articles of Agreement.

### Settlement of questions
- Any question arising under this agreement shall be settled by mutual agreement between the Bank of Finland and the Fund.

### Transitional arrangements (paragraph 14)
- General transitional rules:
  - Regardless of whether this agreement is activated or not, the Fund:
    - (i) subject to paragraph 14(b) below, shall make drawings under this agreement to repay any outstanding claims under the Bank of Finland's 2016 Borrowing Agreement, and
    - (ii) may make drawings under this agreement to fund purchases under commitments approved by the Fund during an activation of the 2016 Borrowing Agreements or to fund early repayment of claims under other 2016 Borrowing Agreements in case the creditor represents a balance of payments need;
    - provided that notwithstanding paragraph 5(a) of this agreement the maximum maturity date of the claim from the repayment herein shall be the residual maximum maturity date of the claim that is repaid with drawings under this agreement;
    - and provided further that any claims under this agreement that result from the repayment herein shall be considered claims under the 2016 Borrowing Agreements for purposes of funding the early repayment of these claims in case of balance of payments need in accordance with the 2016 Borrowing Agreements, and for purposes of special calls under paragraph 23 of the Fund's Decision No. 16645-(20/5), adopted January 16,2020.
- NAB credit arrangement interaction:
  - To the extent that claims under the Bank of Finland's 2016 Borrowing Agreement or this agreement are outstanding when the increase in Finland's NAB credit arrangement becomes effective, the Bank of Finland shall be deemed to request, on behalf of Finland, in accordance with paragraph 23 of the Fund's Decision No. 11428-(97/6), adopted January 27,1997 on the NAB, as amended, that the Managing Director make calls under Finland's NAB credit arrangement up to the maximum available amount, taking into account the Fund's need for maintaining prudential balances, to fund the repayment of such claims;
    - provided that if the increase in Finland's NAB credit arrangement and this agreement enter into effect at the same time, the repayment of the Bank of Finland's outstanding claims under the Bank of Finland's 2016 Borrowing Agreement shall be funded first with calls under Finland's NAB credit arrangement before drawings are made under this agreement pursuant to paragraph 14(a) above.
- Excess claims and repayment order:
  - If following the repayment of outstanding claims under the Bank of Finland's 2016 Borrowing Agreement and this agreement as provided in paragraph 14(b) above, the Bank of Finland's outstanding claims under these agreements remain in excess of the Rolled Back Loan Amount as calculated pursuant to paragraph 10(b), the Fund shall repay any outstanding claims under the Bank of Finland's 2016 Borrowing Agreement and this agreement in excess of the Rolled Back Loan Amount;
    - provided that claims with shorter remaining maximum maturities shall be repaid before those with longer remaining maximum maturities.
- Cessation of drawings under 2016 Agreement:
  - After the entry into force of this agreement, the Fund may make no further drawing under the Bank of Finland's 2016 Borrowing Agreement.
- Drawing limits relative to Loan Amount and Rolled Back Loan Amount:
  - No drawing under this agreement shall be made that would cause the total outstanding drawings under both this agreement and the 2016 Borrowing Agreement between the Bank of Finland and the Fund, at the time of such drawing, to:
    - (i) exceed the Loan Amount prior to the effectiveness of the increase in Finland's NAB credit arrangement, or
    - (ii) exceed the Rolled Back Loan Amount upon and after the effectiveness of the increase in Finland's NAB credit arrangement, as calculated pursuant to paragraph l0(b);
    - provided that drawings beyond the Rolled Back Loan Amount under (ii) herein are authorized, if within the same day of these drawings any resulting claim that would exceed the Rolled Back Loan Amount is repaid with a special call under Finland's NAB credit arrangement, and the Bank of Finland hereby requests, on behalf of Finland, that the Managing Director make such calls to fund the repayment in accordance with paragraph 23 of the Fund's Decision No. 11428-(97/6), adopted January 27,1997 on the NAB, as amended.

### Final provisions and execution
- Execution and effectiveness:
  - This agreement may be executed in duplicate counterparts, each of which shall be deemed an original and both of which together shall constitute but one and the same instrument.
  - This agreement shall become effective on the date last signed below or on the date on which Finland provides the concurrence that is required under Article Vll, Section 1(i) of the Fund's Articles of Agreement for Fund borrowing of euro from the Bank of Finland, or on January 1, 2021, whichever is later.
- Signatures:
  - For the Bank of Finland: Honorable Olli Rehn, Governor.
  - For the lnternational Monetary Fund: Kristalina Georgieva, Managing Director.
  - Date shown: 12/21/2020.

*Source: pr214-signed-finland-2020-borrowing-agreements (PDF).*

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_Source: https://www.imf.org/-/media/files/news/press-release/2021/pr214/pr214-signed-finland-2020-borrowing-agreements.pdf_