## ppea2023050 ## Source details **Canonical URL:** [ppea2023050](https://www.imf.org/-/media/files/publications/pp/2023/english/ppea2023050.pdf) ## Other formats - [Markdown version](/-/media/files/publications/pp/2023/english/ppea2023050.pdf.md) - [Structured JSON version](/-/media/files/publications/pp/2023/english/ppea2023050.pdf.json) --- ### EXECUTIVE SUMMARY — INTRODUCTION - Purpose: - Assist central banks evaluate and improve their transparency practices, strengthen dialogue with stakeholders, and contribute to policy effectiveness. - Applicable to all IMF members, on a voluntary basis. - Expected benefits: - Enable more informed central bank choices on transparency, including confidentiality. - Facilitate more effective communication with stakeholders and explain absence of specific disclosures. - Enhance understanding of central bank mandate, governance, policies, operations, outcomes, and official relations; reduce uncertainty; anchor public expectations; foster better policies. - Context: - Update of the Guidance Note published in January 2021 following approval of the CBT by IMF Executive Board. - Draws on lessons learned from seven pilot CBT reviews and aims to streamline the CBT review process. - The Guidance Note is not a detailed or prescriptive manual for measuring transparency; it is a guiding tool that preserves flexibility for interpretation and country-specific circumstances. ### SCOPE AND COVERAGE - Framework: - CBT review should be carried out based on the CBT’s five-pillar framework covering all areas of central banking: - Pillar I. Transparency in governance (institutional issues). - Pillar II. Transparency in policies (foundations of policy decisions). - Pillar III. Transparency in operations (implementation of policy decisions). - Pillar IV. Transparency in outcome (outcome of central bank policies and other actions). - Pillar V. Transparency in official relations (interactions with government, domestic agencies, international relations and commitments). - Figure 1: Central Bank Transparency: Five-Pillar Framework (referenced in source). - Review scope and coverage principles: - Scope must be clearly stated and explained (pillars and components within pillars). - Scope should be discussed and agreed with the central bank and explained considering legal mandate, structure, organization, and contextual issues. - Reviews should cover all five pillars; central banks may request heightened attention to selected areas. ### KEY DELIVERABLES - Detailed Review Report (DRR): - Presents the output of the CBT review. - Provides summary and detailed discussion on mission’s findings and recommendations per (sub) principle. - Includes a section where the participating central bank responds to findings and recommendations and outlines steps to further improve transparency. - Includes a Proposed Action Plan table specifying whether follow-up capacity development (Technical Assistance (TA), workshops, resident expertise) may be needed. - The Detailed Review Report is to be published by the IMF, with the consent of the authorities, on its CBT web portal. ### CBT REVIEW IN PRACTICE — KEY CONSIDERATIONS (A. Scope) - Coverage of activities: - Reviews include all activities de-facto performed by the central bank notwithstanding the wording of its legal mandate. - Example: macroprudential policies—if central bank is actively involved in design/implementation despite no formal mandate, transparency of those policies is reviewed under relevant (sub) principles of Pillars II, III, and IV. - Transparency about mandates and inactive areas: - Central banks should articulate reasons and modalities where activities lack explicit legal mandate. - If legally mandated but no regular actions over extended periods (example: FX management policy in countries with free-floating exchange rate; Emergency Liquidity Assistance (ELA) activities), central bank should outline objectives and framework and be transparent about absence of related actions; such practices reviewed under Pillar II and denoted “Not Applicable” under Pillars III and IV. - Emerging mandates and activities: - Reviews should cover newly emerging mandates and activities even if not explicitly mentioned in the CBT (example: Central Bank Digital Currencies (CBDC), financial inclusion). - Reviewer should evaluate transparency under Principle 1.2 (central bank’s mandate) and document practices in text box if central bank is actively involved. - Joint mandates and agency roles: - If central bank has a joint mandate with other public institutions, only the central bank’s transparency practices are reviewed; disclosures on relations with other agencies are reviewed under Pillar V. - If central bank plays advisory or agency role (example: agent of government in FX reserve management), those practices are reviewed under Pillar V. - Exclusions: - The CBT review does not include transparency on micro-prudential supervision, resolution, and financial market infrastructure (areas covered by international standards and assessed in FSAP and stand-alone assessments). - Where ROSCs, DARs and TNs have been published, CBT Review should include references to these publications in the Background Information section of the DRR. ### CBT REVIEW IN PRACTICE — KEY CONSIDERATIONS (B. Key Concepts) - Country-specific context: - Central bank transparency practices are reviewed in the context of country-specific circumstances (legal frameworks, governance arrangements, levels of economic and financial development). - Domestic laws (for example, “freedom of information” laws) can require disclosure or confidentiality and must be taken into account. - Scope of judgment: - The CBT review does not pass judgment on central bank governance arrangements, policy frameworks, decisions, or actions. - Pillar I focuses on transparency practices regarding governance without prescribing what governance should be. - Pillars II, III, IV focus on transparency of policies and actions without assessing policy appropriateness or operational toolkits. - Balancing transparency and confidentiality: - CBT recognizes legitimate confidentiality needs (market-sensitive information, financial stability considerations, personal data). - Confidentiality is particularly pertinent in FX interventions, FX reserve management, supervisory decisions on individual institutions, and ELA. - Central banks should articulate a clear confidentiality policy explaining and justifying disclosure choices and legal obligations. ### CBT REVIEW IN PRACTICE — KEY CONSIDERATIONS (C. Principles and Practices) - Structure: - CBT consists of (sub) principles with defined transparency practices. - Practices are categorized into “Core,” “Expanded,” and “Comprehensive” corresponding to the level of transparency. - In several cases distinctions across categories are limited or nonexistent (examples: Sub-principles 2.2.1, 4.2.1; Principles 2.11, 3.12, and 4.11 on consumer protection). - Review approach: - CBT review evaluates central bank transparency practices against CBT principles, accounting for country circumstances, providing justifications for conclusions, and proposing an action plan for improvements. - Where practices cut across multiple principles, the review should map the main focus and recommend consolidation as appropriate. - Applicability and findings labels: - Not all principles/practices are applicable to every central bank; practices may be reviewed as “Not Applicable” where relevant (see Paragraph 7). - “Not Implemented” should be assigned to (sub) principles within scope where the central bank has not implemented them or implementation falls short of the “Core” practice description. ### PROCESS AND OUTPUTS — GUIDANCE NOTE ROLE - Guidance Note role: - Provides practical suggestions on reviewing transparency practices according to CBT, discusses likely issues during reviews, and outlines main stages of the review process including key deliverables. - To be published on the CBT web portal; updates will be published to keep stakeholders informed. - Complemented by detailed Procedural Guidelines reserved for internal use to support CBT review team members. - Review stages and outputs: - The Guidance Note outlines CBT Review Stages and CBT Review Outputs (referenced in document sections and figures). - BOX 1: CBT Review and Other IMF Workstreams is included in the Guidance Note (referenced). - Appendix I provides guidance and templates for writing the CBT Detailed Review Report. ### GUIDELINES FOR ASSIGNING THE RANGE OF PRACTICES - Consistency: - The guidelines for assigning the range of practices should be consistent across the reviews. - Default assignment: - When the level of distinction between three categories (i.e., “Core”, “Expanded”, and “Comprehensive”) is limited or nonexistent (see Paragraph 15), there should be limited discretion in assigning the range of practices and “Core” should be assigned by default (or “Not Implemented” if the practices fall below the level of “Core”). - Sub-principles: - If the principle comprises sub-principles, the review should only cover the sub-principles. - Allowed categories: - The range of practices assigned has to be limited to five categories described in this Section: “Core”, “Expanded”, “Comprehensive”, “Not Applicable” and “Not Implemented”. ### DIMENSIONS OF TRANSPARENCY - Public disclosure: - Public disclosure is a critical component of transparency and is the means by which the central bank can showcase its decisions, the underlying rationale, and possible consequences to fulfill information needs and manage expectations. - Definitions and means: - As noted in the CBT’s Glossary, “disclose” (and similarly, “publicly available,” “publicly disclosed,” “clearly disclosed”) includes publication of the legal framework, policy decisions and any other information related to central bank’s activities. - Non-exhaustive means of disclosure include: central bank website; official gazette; circulars; electronic messages via central bank reporting and communication channels; publications, interviews, speeches, and articles in various media (printed or electronic); other electronic communication (such as, social media platforms). - Recipient of disclosure: - “Public” encompasses all interested individuals, institutions, and entities, whether domestic or international, including the general public. - A broad definition includes the central bank’s own staff, the country’s legislative power, the government (including the Ministry of Finance or equivalent department), other financial supervisory and regulatory agencies, financial institutions, other market parties, and the general public (including, but not limited to, (financial) press, consumers, deposit holders, investors and academics). - Timeliness: - Transparency needs to be timely to be meaningful; disclosure after the information need has passed is insufficient. - Timeliness depends on the objective: e.g., informing market parties of forthcoming decisions or decisions just taken (monetary policy, macroprudential oversight). - Frequency and form: - Transparency could be one-off or multiple disclosures over time. - Monetary policy decisions (e.g., interest rate decisions) are likely disclosed at regular intervals. - Infrequent matters (organizational changes, communication policy, legal changes) require accessible disclosure though not frequent updates. - More frequent regulatory framework changes (e.g., foreign currency transactions) require more frequent transparency. - Quality of disclosure: - The CBT review considers accessibility and ease of understanding of public information. - Communications should account for varied financial literacy among stakeholders so they can understand and gauge consequences. - Information relevant to specific stakeholders should be accessible with little effort; if discoverability requires tailored external search queries or is difficult to find on the central bank’s site, it is not readily available. - Publication in mass media should be in popular printed or electronic mass media accessible without significant effort. - Language considerations: - Transparency practices are reviewed with respect to the main language(s) of the country. - In multilingual countries, regional language limitations should be taken into account. - Comprehensive and timely disclosures in foreign, non-domestic languages are not required unless there is strong aggregated stakeholder feedback to enhance disclosures in those languages. ### CBT REVIEW PROCESS AND STAGES - Review initiation: - The review is initiated at the request of the central bank with an official letter addressed to the Director of IMF Monetary and Capital Markets Department or via request made during the IMF/World Bank Annual or Spring Meetings. - The IMF review team starts to discuss modalities and timeline (see Figure 2) with the central bank. - It is recommended that authorities designate a senior staff member to coordinate the review and act as point of contact for the IMF team. - Review workshop and self-review: - The review mission process starts with a CBT review workshop to discuss key elements and facilitate the central bank’s self-review; central bank management and staff expected to participate. - During the workshop the IMF team presents key concepts across all five pillars and addresses authorities’ questions; authorities can highlight areas for particular focus (e.g., macroprudential policy, relations with the government). - Upon agreement on scope, the central bank finalizes the self-review using the Detailed Review template (see Table 2 in Appendix I) and shares it with the IMF team. - Desk review inputs: - The self-review form is a key input for the desk review. Other inputs include all public information on the central bank’s mandate and activities: official website, laws and regulations, reports and publications, relevant IMF workstreams and other country publications. - Mission meetings and cut-off: - Self-review and desk review form the basis for bilateral discussions during the review mission with management, staff and external stakeholders. - Meetings with external stakeholders canvass their views; summarized views are important inputs though individual opinions are not directly translated into outputs. - The last day of the mission is the cut-off date for review findings; initiatives implemented after this date are not considered, though they may be reflected in the Authorities’ Response section of the DRR. - Drafting and publication: - Shortly after the concluding meeting the draft DRR is shared with authorities for factual checks; the draft DRR is subject to IMF internal review and clearance. - The central bank drafts the Authorities’ Response section and a proposed Action Plan table (see Table 3 in Appendix I). - After finalization the DRR is published by the IMF with the consent of the authorities. - Notes on coordination and stakeholders: - The review coordinator should facilitate review issues across departments and help identify relevant external stakeholders. - Meetings with external stakeholders are facilitated by the central bank but central bank officials do not attend such meetings to facilitate candid exchange. - Typical key stakeholders: financial sector regulators, other government agencies, parliamentarians, financial sector entities, business associations, media, financial analysts, and academia. - Interaction with other IMF workstreams (Box 1): - The IMF review team should use relevant IMF country documents, including Article IV Staff Reports, FSAP reports, FSSR reports, Governance Diagnostic Assessment (GDA) reports, Technical Assistance reports, and others. - If FSAP, FSSR or GDA were recently conducted, the review team should study recommendations related to transparency in financial stability, macroprudential policy, relations with other financial sector regulators. - CBT review findings should inform other Fund workstreams; Area Department teams may use findings in Article IV consultations and Use of Fund Resources programs. - CBT reviews can contribute to FSAP, FSSR and GDA with respect to transparency of financial stability, macroprudential and financial integrity policies. - Proposed Action Plan table (see Table 3 in Appendix I) specifies whether the central bank sees need for follow-up TA; if TA is needed the CBT review mission chief, jointly with MCM TA Division, follows up on modalities. ### CBT REVIEW OUTPUTS — DETAILED REVIEW REPORT (DRR) STRUCTURE - Executive Summary: - Brief discussion of main findings, strengths and areas for improvement; key recommendations. - Includes a table with summary overview of ranges of transparency practices according to five-pillar framework (Table 1 in Appendix I). - Scope and Objectives: - Clarifies scope and states areas not covered; highlights objectives of the CBT review. - Approach and Methodology: - Provides guidance on the review’s approach and key concepts in line with Section II of the Guidance Note. - Background Information: - Describes organization assessed, relevant country information, institutional setting and context; includes information on recent FSAPs, FSSRs and/or stand-alone assessments if they covered transparency issues pertinent to CBT. - Main Findings: - Discusses findings pillar-by-pillar and in areas not explicitly mentioned in the CBT. - Provides overall evaluation of quality of transparency practices against CBT principles, identifies strengths and main areas of concern impacting transparency. - For practices needing improvement, the summary should provide main reasons for shortfall, indicate whether efforts are being made to address them and within what timeframe. - Discusses extent of progress achievable if current efforts proceed as envisaged in accordance to practices categories. - Authorities’ Response: - Drafted by the central bank reflecting its views on findings and recommendations. - Includes a proposed Action Plan table (see template of Table 3 in Appendix I) containing the central bank’s response, intended actions and timeframe. - Central bank may specify whether follow-up TA is needed to implement recommendations. - Detailed Review Table: - Includes detailed (sub) principle-by-(sub) principle review (see template of Table 2 in Appendix I). ### APPENDIX I — GUIDANCE AND TEMPLATES FOR WRITING THE DRR - General: - Provide background information on the review, describe the organization being assessed and the context. - Information used for review: - Detail main information sources: relevant laws, regulations and instructions, other legal/regulatory instruments issued by the central bank, documentation (reports, studies, public statements, websites, unpublished guidelines, directives, and reviews); counterpart agencies and officials with whom discussions were held; meetings with domestic authorities and relevant associations. - Describe factors that facilitated or impaired the review, including extent of non-cooperation and indicate extent to which these factors may have affected objectivity. - Principle-by-principle review: - The review is intended to assess central bank’s transparency practices with respect to the CBT practice categories for each principle and should follow considerations in Section II. - The review should avoid using terms that indicate rating (e.g., observed, partially observed, etc.). - The review should match the applicable practice category whenever the practice criteria is generally met without significant gaps. - If central bank practice covers elements in more than one CBT practice category, indicate which category the weight of the practice falls under and highlight elements covered by other categories. - The review should elaborate on efforts underway to enhance transparency and what the overall situation would be when current efforts are completed; reviewers may state “Practice x will meet the CBT principle under CBT practice category [X] when...,” noting importance of exceptions. - Each principle review should have three parts: description, review, and comments (Table 2). - Description: - Provide information on the principle as practiced by the central bank; cite sections of laws, regulations, circulars, press releases or other public disclosure instruments relevant to each assessed Principle and note where/how the information is disclosed. - Leave this section blank if the Review is “Not Applicable.” ### PARAGRAPHS 11–14 — TASK OVERVIEW, PROCEDURE, AND EXPECTED OUTPUTS - Required components (paragraphs 11–14): - Assign the range of practices to the respective (sub) principle. - Present a clear qualitative review of the degree of adherence with the CBT principles. - Provide comments elaborating on findings and contextual issues. - Solicit and incorporate the Authorities’ Response. - Include a Proposed Action Plan as part of the Authorities’ Response. - Key procedural steps: - 11. Assign practices to (sub)principles and present a qualitative review of adherence with CBT principles. - 12. Elaborate on the review’s findings, noting relevant contextual issues; explain “Not Applicable” designations. - 13. Provide the central bank an opportunity to respond; incorporate the central bank’s concise written response into the DRR without modification; document differing views. - 14. Central bank fills in Proposed Action Plan table (Table 3) listing: Review’s key recommendations; Central bank’s response to each recommendation; Timeline for implementation (if applicable); Whether IMF TA might be needed. - Expected outputs from the reviewer: - A mapping of practices to each (sub) principle (Core / Expanded / Comprehensive where applicable). - A qualitative assessment of degree of adherence for each (sub) principle. - Explanatory comments and contextual notes; explicit rationale for any “Not Applicable” designations. - Documentation of the consultation process and any differing views provided by the central bank. - Inclusion of an unmodified concise written Authorities’ Response in the DRR. - A completed Proposed Action Plan table (Table 3) filled by the central bank. - Process norms emphasized: - Review is consultative and based on extensive discussions with central bank management and staff. - Authorities’ written response must be incorporated without modification. - Differing views must be documented alongside review findings. - Structural reference: Table 1 — Central Bank Transparency Overview - Table 1 maps Pillars, Principles, Sub-principles, and Practices across three practice levels: Core, Expanded, Comprehensive. - Example pillar and component listing includes detailed enumeration of Pillars I–V and sub-elements (see source for full list). ### SECTION 5.4 — OTHER RELATIONS (PRINCIPLE 5.4) - Scope and Objective: - Principle 5.4: "The central bank discloses its involvement with private or semi-public institutions." - Focus: transparency regarding the central bank’s external relations beyond government, domestic and foreign agencies. - Required Disclosures (Principle 5.4.1): - The central bank discloses its investments in and ownership of subsidiaries and joint ventures with private, semi-public, or public entities. - Disclosure elements implied by the template: Description; Review; Comments. - Related Review Template and Action Plan (Table 3): - Proposed Action Plan structure fields: - CBT Review Recommendation - Central Bank’s Response - Timeframe for Implementation* - Technical Assistance Needed - Example status options: "Near term/ Medium term/ Not Applicable/ Implemented" - Example TA options: "Yes/No" - * Near term: "< 12 months; Medium term: 12 to 24 months; Not Applicable: The central bank is not planning to implement recommendation within next 24 months." - Implementation and Reporting Guidance: - Disclosures should be framed within the "Description / Review / Comments" sections used throughout the Code. - Disclosure of investments and ownership should be capable of feeding into the central bank’s proposed action plan (Table 3) for remedies or enhancements. *International Monetary Fund — CENTRAL BANK TRANSPARENCY CODE REVIEW GUIDANCE NOTE (excerpt provided in source content).* ### EXECUTIVE SUMMARY ### EXECUTIVE SUMMARY ### INTRODUCTION — Objectives of the CBT Review - Purpose: - Assist central banks evaluate and improve their transparency practices, strengthen dialogue with stakeholders, and contribute to policy effectiveness. - Applicable to all IMF members, on a voluntary basis. - Expected benefits: - Enable more informed central bank choices on transparency, including confidentiality. - Facilitate more effective communication with stakeholders and explain absence of specific disclosures. - Enhance understanding of central bank mandate, governance, policies, operations, outcomes, and official relations; reduce uncertainty; anchor public expectations; foster better policies. - Context: - Update of the Guidance Note published in January 2021 following approval of the CBT by IMF Executive Board. - Draws on lessons learned from seven pilot CBT reviews and aims to streamline the CBT review process. - The Guidance Note is not a detailed or prescriptive manual for measuring transparency; it is a guiding tool that preserves flexibility for interpretation and country-specific circumstances. ### SCOPE AND COVERAGE - Framework: - CBT review should be carried out based on the CBT’s five-pillar framework covering all areas of central banking: - Pillar I. Transparency in governance (institutional issues). - Pillar II. Transparency in policies (foundations of policy decisions). - Pillar III. Transparency in operations (implementation of policy decisions). - Pillar IV. Transparency in outcome (outcome of central bank policies and other actions). - Pillar V. Transparency in official relations (interactions with government, domestic agencies, international relations and commitments). - Figure 1: Central Bank Transparency: Five-Pillar Framework (referenced in source). - Review scope and coverage principles: - Scope must be clearly stated and explained (pillars and components within pillars). - Scope should be discussed and agreed with the central bank and explained considering legal mandate, structure, organization, and contextual issues. - Reviews should cover all five pillars; central banks may request heightened attention to selected areas. ### KEY DELIVERABLES - Detailed Review Report (DRR): - Presents the output of the CBT review. - Provides summary and detailed discussion on mission’s findings and recommendations per (sub) principle. - Includes a section where the participating central bank responds to findings and recommendations and outlines steps to further improve transparency. - Includes a Proposed Action Plan table specifying whether follow-up capacity development (Technical Assistance (TA), workshops, resident expertise) may be needed. - The Detailed Review Report is to be published by the IMF, with the consent of the authorities, on its CBT web portal. ### CBT REVIEW IN PRACTICE: KEY CONSIDERATIONS H3: A. CBT Review Scope - Coverage of activities: - Reviews include all activities de-facto performed by the central bank notwithstanding the wording of its legal mandate. - Example: macroprudential policies—if central bank is actively involved in design/implementation despite no formal mandate, transparency of those policies is reviewed under relevant (sub) principles of Pillars II, III, and IV. - Transparency about mandates and inactive areas: - Central banks should articulate reasons and modalities where activities lack explicit legal mandate. - If legally mandated but no regular actions over extended periods (example: FX management policy in countries with free-floating exchange rate; Emergency Liquidity Assistance (ELA) activities), central bank should outline objectives and framework and be transparent about absence of related actions; such practices reviewed under Pillar II and denoted “Not Applicable” under Pillars III and IV. - Emerging mandates and activities: - Reviews should cover newly emerging mandates and activities even if not explicitly mentioned in the CBT (example: Central Bank Digital Currencies (CBDC), financial inclusion). - Reviewer should evaluate transparency under Principle 1.2 (central bank’s mandate) and document practices in text box if central bank is actively involved. - Joint mandates and agency roles: - If central bank has a joint mandate with other public institutions, only the central bank’s transparency practices are reviewed; disclosures on relations with other agencies are reviewed under Pillar V. - If central bank plays advisory or agency role (example: agent of government in FX reserve management), those practices are reviewed under Pillar V. - Exclusions: - The CBT review does not include transparency on micro-prudential supervision, resolution, and financial market infrastructure (areas covered by international standards and assessed in FSAP and stand-alone assessments). - Where ROSCs, DARs and TNs have been published, CBT Review should include references to these publications in the Background Information section of the DRR. H3: B. Key Concepts for the Implementation of CBT Review - Country-specific context: - Central bank transparency practices are reviewed in the context of country-specific circumstances (legal frameworks, governance arrangements, levels of economic and financial development). - Domestic laws (for example, “freedom of information” laws) can require disclosure or confidentiality and must be taken into account. - Scope of judgment: - The CBT review does not pass judgment on central bank governance arrangements, policy frameworks, decisions, or actions. - Pillar I focuses on transparency practices regarding governance without prescribing what governance should be. - Pillars II, III, IV focus on transparency of policies and actions without assessing policy appropriateness or operational toolkits. - Balancing transparency and confidentiality: - CBT recognizes legitimate confidentiality needs (market-sensitive information, financial stability considerations, personal data). - Confidentiality is particularly pertinent in FX interventions, FX reserve management, supervisory decisions on individual institutions, and ELA. - Central banks should articulate a clear confidentiality policy explaining and justifying disclosure choices and legal obligations. H3: C. CBT Principles and Practices - Structure: - CBT consists of (sub) principles with defined transparency practices. - Practices are categorized into “Core,” “Expanded,” and “Comprehensive” corresponding to the level of transparency. - In several cases distinctions across categories are limited or nonexistent (examples: Sub-principles 2.2.1, 4.2.1; Principles 2.11, 3.12, and 4.11 on consumer protection). - Review approach: - CBT review evaluates central bank transparency practices against CBT principles, accounting for country circumstances, providing justifications for conclusions, and proposing an action plan for improvements. - Where practices cut across multiple principles, the review should map the main focus and recommend consolidation as appropriate. - Applicability and findings labels: - Not all principles/practices are applicable to every central bank; practices may be reviewed as “Not Applicable” where relevant (see Paragraph 7). - “Not Implemented” should be assigned to (sub) principles within scope where the central bank has not implemented them or implementation falls short of the “Core” practice description. ### PROCESS AND OUTPUTS (summary points referenced) - Guidance Note role: - Provides practical suggestions on reviewing transparency practices according to CBT, discusses likely issues during reviews, and outlines main stages of the review process including key deliverables. - To be published on the CBT web portal; updates will be published to keep stakeholders informed. - Complemented by detailed Procedural Guidelines reserved for internal use to support CBT review team members. - Review stages and outputs: - The Guidance Note outlines CBT Review Stages and CBT Review Outputs (referenced in document sections and figures). - BOX 1: CBT Review and Other IMF Workstreams is included in the Guidance Note (referenced). - Appendix I provides guidance and templates for writing the CBT Detailed Review Report. *Source: CENTRAL BANK TRANSPARENCY CODE REVIEW GUIDANCE NOTE — EXECUTIVE SUMMARY (October 31, 2023).* ### 19. The guidelines for assigning the range of practices should be consistent across the ### ppea2023050 - 19. The guidelines for assigning the range of practices should be consistent across the ### Guidelines for assigning the range of practices - The guidelines for assigning the range of practices should be consistent across the reviews. - When the level of distinction between three categories (i.e., “Core”, “Expanded”, and “Comprehensive”) is limited or nonexistent (see Paragraph 15), there should be limited discretion in assigning the range of practices and “Core” should be assigned by default (or “Not Implemented” if the practices fall below the level of “Core”). - If the principle comprises sub-principles, the review should only cover the sub-principles. - The range of practices assigned has to be limited to five categories described in this Section: “Core”, “Expanded”, “Comprehensive”, “Not Applicable” and “Not Implemented”. ### Dimensions of Transparency - Public disclosure is a critical component of transparency and is the means by which the central bank can showcase its decisions, the underlying rationale, and possible consequences to fulfill information needs and manage expectations. - Definitions and means: - As noted in the CBT’s Glossary, “disclose” (and similarly, “publicly available,” “publicly disclosed,” “clearly disclosed”) includes publication of the legal framework, policy decisions and any other information related to central bank’s activities. - Non-exhaustive means of disclosure include: central bank website; official gazette; circulars; electronic messages via central bank reporting and communication channels; publications, interviews, speeches, and articles in various media (printed or electronic); other electronic communication (such as, social media platforms). - The recipient of disclosure is the public at large. “Public” in the context of the CBT encompasses all interested individuals, institutions, and entities, whether domestic or international, including the general public. - A broad definition of “public” would include, in most circumstances, the central bank’s own staff, the country’s legislative power, the government (including the Ministry of Finance or equivalent department), other financial supervisory and regulatory agencies, financial institutions, other market parties, and the general public (including, but not limited to, (financial) press, consumers, deposit holders, investors and academics). - Timeliness: - Transparency needs to be timely to be meaningful; disclosure after the information need has passed is insufficient. - Timeliness depends on the objective: e.g., informing market parties of forthcoming decisions or decisions just taken (monetary policy, macroprudential oversight). - Frequency and form: - Transparency could be one-off or multiple disclosures over time. - Monetary policy decisions (e.g., interest rate decisions) are likely disclosed at regular intervals. - Infrequent matters (organizational changes, communication policy, legal changes) require accessible disclosure though not frequent updates. - More frequent regulatory framework changes (e.g., foreign currency transactions) require more frequent transparency. - Quality of disclosure: - The CBT review considers accessibility and ease of understanding of public information. - Communications should account for varied financial literacy among stakeholders so they can understand and gauge consequences. - Information relevant to specific stakeholders should be accessible with little effort; if discoverability requires tailored external search queries or is difficult to find on the central bank’s site, it is not readily available. - Publication in mass media should be in popular printed or electronic mass media accessible without significant effort. - Language considerations: - Transparency practices are reviewed with respect to the main language(s) of the country. - In multilingual countries, regional language limitations should be taken into account. - Comprehensive and timely disclosures in foreign, non-domestic languages are not required unless there is strong aggregated stakeholder feedback to enhance disclosures in those languages. ### CBT Review Process and Stages - The CBT review process is based on cooperation between the IMF team and central bank’s management and staff and consists of the following stages: - Review initiation: - The review is initiated at the request of the central bank with an official letter addressed to the Director of IMF Monetary and Capital Markets Department or via request made during the IMF/World Bank Annual or Spring Meetings. - The IMF review team starts to discuss modalities and timeline (see Figure 2) with the central bank. - It is recommended that authorities designate a senior staff member to coordinate the review and act as point of contact for the IMF team. - Review workshop and self-review: - The review mission process starts with a CBT review workshop to discuss key elements and facilitate the central bank’s self-review; central bank management and staff expected to participate. - During the workshop the IMF team presents key concepts across all five pillars and addresses authorities’ questions; authorities can highlight areas for particular focus (e.g., macroprudential policy, relations with the government). - Upon agreement on scope, the central bank finalizes the self-review using the Detailed Review template (see Table 2 in Appendix I) and shares it with the IMF team. - Desk review inputs: - The self-review form is a key input for the desk review. Other inputs include all public information on the central bank’s mandate and activities: official website, laws and regulations, reports and publications, relevant IMF workstreams and other country publications. - Mission meetings and cut-off: - Self-review and desk review form the basis for bilateral discussions during the review mission with management, staff and external stakeholders. - Meetings with external stakeholders canvass their views; summarized views are important inputs though individual opinions are not directly translated into outputs. - The last day of the mission is the cut-off date for review findings; initiatives implemented after this date are not considered, though they may be reflected in the Authorities’ Response section of the DRR. - Drafting and publication: - Shortly after the concluding meeting the draft DRR is shared with authorities for factual checks; the draft DRR is subject to IMF internal review and clearance. - The central bank drafts the Authorities’ Response section and a proposed Action Plan table (see Table 3 in Appendix I). - After finalization the DRR is published by the IMF with the consent of the authorities. - Notes on coordination and stakeholders: - The review coordinator should facilitate review issues across departments and help identify relevant external stakeholders. - Meetings with external stakeholders are facilitated by the central bank but central bank officials do not attend such meetings to facilitate candid exchange. - Typical key stakeholders: financial sector regulators, other government agencies, parliamentarians, financial sector entities, business associations, media, financial analysts, and academia. - Interaction with other IMF workstreams (Box 1): - The IMF review team should use relevant IMF country documents, including Article IV Staff Reports, FSAP reports, FSSR reports, Governance Diagnostic Assessment (GDA) reports, Technical Assistance reports, and others. - If FSAP, FSSR or GDA were recently conducted, the review team should study recommendations related to transparency in financial stability, macroprudential policy, relations with other financial sector regulators. - CBT review findings should inform other Fund workstreams; Area Department teams may use findings in Article IV consultations and Use of Fund Resources programs. - CBT reviews can contribute to FSAP, FSSR and GDA with respect to transparency of financial stability, macroprudential and financial integrity policies. - Proposed Action Plan table (see Table 3 in Appendix I) specifies whether the central bank sees need for follow-up TA; if TA is needed the CBT review mission chief, jointly with MCM TA Division, follows up on modalities. ### CBT Review Outputs - The Detailed Review Report (DRR) structure should include: - Executive Summary: - Brief discussion of main findings, strengths and areas for improvement; key recommendations. - Includes a table with summary overview of ranges of transparency practices according to five-pillar framework (Table 1 in Appendix I). - Scope and Objectives: - Clarifies scope and states areas not covered; highlights objectives of the CBT review. - Approach and Methodology: - Provides guidance on the review’s approach and key concepts in line with Section II of the Guidance Note. - Background Information: - Describes organization assessed, relevant country information, institutional setting and context; includes information on recent FSAPs, FSSRs and/or stand-alone assessments if they covered transparency issues pertinent to CBT. - Main Findings: - Discusses findings pillar-by-pillar and in areas not explicitly mentioned in the CBT. - Provides overall evaluation of quality of transparency practices against CBT principles, identifies strengths and main areas of concern impacting transparency. - For practices needing improvement, the summary should provide main reasons for shortfall, indicate whether efforts are being made to address them and within what timeframe. - Discusses extent of progress achievable if current efforts proceed as envisaged in accordance to practices categories. - Authorities’ Response: - Drafted by the central bank reflecting its views on findings and recommendations. - Includes a proposed Action Plan table (see template of Table 3 in Appendix I) containing the central bank’s response, intended actions and timeframe. - Central bank may specify whether follow-up TA is needed to implement recommendations. - Detailed Review Table: - Includes detailed (sub) principle-by-(sub) principle review (see template of Table 2 in Appendix I). ### Appendix I — Guidance and Templates for Writing the CBT Detailed Review Report - General: - Provide background information on the review, describe the organization being assessed and the context. - Information used for review: - Detail main information sources: relevant laws, regulations and instructions, other legal/regulatory instruments issued by the central bank, documentation (reports, studies, public statements, websites, unpublished guidelines, directives, and reviews); counterpart agencies and officials with whom discussions were held; meetings with domestic authorities and relevant associations. - Describe factors that facilitated or impaired the review, including extent of non-cooperation and indicate extent to which these factors may have affected objectivity. - Principle-by-principle review: - The review is intended to assess central bank’s transparency practices with respect to the CBT practice categories for each principle and should follow considerations in Section II. - The review should avoid using terms that indicate rating (e.g., observed, partially observed, etc.). - The review should match the applicable practice category whenever the practice criteria is generally met without significant gaps. - If central bank practice covers elements in more than one CBT practice category, indicate which category the weight of the practice falls under and highlight elements covered by other categories. - There may be instances where a country demonstrates a principle-based practice through different disclosure means due to specific conditions. - The review should elaborate on efforts underway to enhance transparency and what the overall situation would be when current efforts are completed; reviewers may state “Practice x will meet the CBT principle under CBT practice category [X] when...,” noting importance of exceptions. - Each principle review should have three parts: description, review, and comments (Table 2). - Description: - Provide information on the principle as practiced by the central bank; cite sections of laws, regulations, circulars, press releases or other public disclosure instruments relevant to each assessed Principle and note where/how the information is disclosed. - Leave this section blank if the Review is “Not Applicable.” *International Monetary Fund — CENTRAL BANK TRANSPARENCY CODE REVIEW GUIDANCE NOTE (excerpt provided in source content)* ### 11. Assign the range of practices to the respective (sub) principle and present a clear qualitative ### 11. Assign the range of practices to the respective (sub) principle and present a clear qualitative review of the degree of the central bank transparency practices’ adherence with the CBT principles. ### Overview of task and scope - Paragraphs 11–14 set out the required components of a Central Bank Transparency (CBT) code review: - Assign the range of practices to the respective (sub) principle. - Present a clear qualitative review of the degree of adherence with the CBT principles. - Provide comments elaborating on findings and contextual issues. - Solicit and incorporate the Authorities’ Response. - Include a Proposed Action Plan as part of the Authorities’ Response. ### Key procedural steps (from text paragraphs 11–14) - 11. Assign practices to (sub)principles and present a qualitative review of adherence with CBT principles. - F. Comments (paragraph 12) - 12. Elaborate on the review’s findings, noting relevant contextual issues. - If a (sub) principle is denoted “Not Applicable”, provide a brief explanation. - G. Authorities’ Response (paragraph 13) - 13. Provide the central bank an opportunity to respond to the review’s findings. - Differences of opinion on review outcomes should be clearly identified, including documentation for differing views. - The review should be a genuine consultative process reflecting comments and concerns from central bank management and staff following extensive discussions. - The central bank should prepare a concise written response, which should be incorporated into the DRR without modification. - H. Proposed Action Plan (paragraph 14) - 14. As part of Authorities’ Response, the central bank fills in Proposed Action Plan table (Table 3), listing: - Review’s key recommendations. - Central bank’s response to each recommendation. - Timeline for implementation (if applicable). - Whether IMF TA might be needed. - The authorities may provide responses to all recommendations at their discretion. ### Expected outputs from the reviewer - A mapping of practices to each (sub) principle (Core / Expanded / Comprehensive where applicable). - A qualitative assessment of degree of adherence for each (sub) principle. - Explanatory comments and contextual notes; explicit rationale for any “Not Applicable” designations. - Documentation of the consultation process and any differing views provided by the central bank. - Inclusion of an unmodified concise written Authorities’ Response in the DRR. - A completed Proposed Action Plan table (Table 3) filled by the central bank. ### Process norms emphasized - Review is consultative and based on extensive discussions with central bank management and staff. - Authorities’ written response must be incorporated without modification. - Differing views must be documented alongside review findings. ### Structural reference: Table 1 — Central Bank Transparency Overview - Table 1 maps Pillars, Principles, Sub-principles, and Practices across three practice levels: Core, Expanded, Comprehensive. - Pillars and example components included: - I. Governance (1.1 Legal Structure; 1.2 Mandate; 1.3 Autonomy with 1.3.1 Institutional/Operational, 1.3.2 Functional, 1.3.3 Personal, 1.3.4 Financial; 1.4 Decision-Making; 1.5 Risk Management with 1.5.1 Risk Exposure, 1.5.2 Risk Framework; 1.6 Accountability Framework with 1.6.1 Arrangements, 1.6.2 Tools, 1.6.3 Anti-Corruption/COC, 1.6.4 Human Capital Management; 1.7 Communication with 1.7.1 Arrangements, 1.7.2 Strategy/Tools; 1.8 Confidentiality). - II. Policies (2.1 Monetary Policy with 2.1.1 Objectives/Framework, 2.1.2 Policy Decisions, 2.1.3 Supporting Analysis; 2.2 FX Administration; 2.3 FX Management; 2.4 FX Reserve Management; 2.5 Macroprudential with 2.5.1 Objectives/Framework, 2.5.2 Policy Decisions, 2.5.3 Supporting Analysis; 2.6 Microprudential Supervision; 2.7 Emergency Liquidity Assistance with 2.7.1 Market-wide Liquidity Support, 2.7.2 Bilateral Liquidity Support; 2.8 Resolution; 2.9 FMI; 2.10 Financial Integrity with 2.10.1 AML/CFT Supervision, 2.10.2 Internal AML/CFT Controls; 2.11 Consumer Protection). - III. Operations (3.1 Monetary Policy with 3.1.1 Instruments, 3.1.2 Coverage, 3.1.3 Access; 3.2 FX Administration; 3.3 FX Management; 3.4 FX Reserve Management with 3.4.1 Instruments, 3.4.2 Coverage, 3.4.3 Assessment; 3.5 Stress Testing with 3.5.1 FS Assessments, 3.5.2 ST Methods, 3.5.3 ST Coverage, 3.5.4 Use of ST Results; 3.6 Macroprudential with 3.6.1 Instruments, 3.6.2 Enforcement; 3.7 Microprudential Supervision; 3.8 Emergency Liquidity Assistance with 3.8.1 Market-wide Liquidity Support, 3.8.2 Bilateral Liquidity Support; 3.9 Resolution; 3.10 FMI; 3.11 Financial Integrity with 3.11.1 AML/CFT Supervision, 3.11.2 Internal AML/CFT Controls; 3.12 Consumer Protection). - IV. Outcome (4.1 Monetary Policy with 4.1.1 Governance Actions, 4.1.2 Policies, 4.1.3 Operations; 4.2 FX Administration; 4.3 FX Management; 4.4 FX Reserve Management with 4.4.1 Governance Actions, 4.4.2 Reporting on Imp., 4.4.3 Financial Results; 4.5 Macroprudential; 4.6 Microprudential Supervision; 4.7 Emergency Liquidity Assistance with 4.7.1 Market-wide Liquidity Support, 4.7.2 Bilateral Liquidity Support; 4.8 Resolution; 4.9 FMI; 4.10 Financial Integrity with 4.10.1 AML/CFT Supervision, 4.10.2 Internal AML/CFT Controls; 4.11 Consumer Protection). - V. Official Relations (5.1 Government with 5.1.1 Institutional, 5.1.2 Financial, 5.1.3 Instruments, 5.1.4 Outcome; 5.2 Domestic Agencies with 5.2.1 Institutional, 5.2.2 Instruments, 5.2.3 Macroprudential, 5.2.4 Financial Stability; 5.3 Foreign Agencies). *Central Bank Transparency Code Review Guidance Note (excerpt: paragraphs 11–14 and Table 1).* ### 5.4 Other Relations ### 5.4 Other Relations ### Scope and Objective - Principle 5.4: "The central bank discloses its involvement with private or semi-public institutions." - Focus: transparency regarding the central bank’s external relations beyond government, domestic and foreign agencies. ### Required Disclosures (Principle 5.4.1) - The central bank discloses its investments in and ownership of subsidiaries and joint ventures with private, semi-public, or public entities. - Disclosure elements implied by the template: Description; Review; Comments. ### Related Review Framework Elements - The document uses a standardized Review template layout for each principle: "Description", "Review", "Comments". - Table 3. Central Bank of [Country Name]: Proposed Action Plan structure (fields shown in the source): - CBT Review Recommendation - Central Bank’s Response - Timeframe for Implementation* - Technical Assistance Needed - Example status options: "Near term/ Medium term/ Not Applicable/ Implemented" - Example TA options: "Yes/No" - * Near term: "< 12 months; Medium term: 12 to 24 months; Not Applicable: The central bank is not planning to implement recommendation within next 24 months." ### Implementation and Reporting Guidance (implied by template) - Disclosures should be framed within the same "Description / Review / Comments" sections used throughout the Code to allow assessment and proposed actions. - Disclosure of investments and ownership should be capable of feeding into the central bank’s proposed action plan (Table 3) for remedies or enhancements. *Source: CENTRAL BANK TRANSPARENCY CODE REVIEW GUIDANCE NOTE — Section 5.4 Other Relations* --- _Source: https://www.imf.org/-/media/files/publications/pp/2023/english/ppea2023050.pdf_