## Borrowing Agreement between the Swedish Riksbank and the International Monetary Fund

## Source details

**Canonical URL:** [Borrowing Agreement between the Swedish Riksbank and the International Monetary Fund](https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/np/pp/eng/2010/_040710.pdf)

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### 1. Purposes and Amounts
- Riksbank agrees to lend to the Fund an SDR-denominated amount up to the equivalent of EUR 2.47 billion to support the Fund’s ability to provide balance of payments assistance.

### 2. Term of the Agreement
- Fund may make drawings for a period of one year commencing on the date the agreement becomes effective in accordance with paragraph 15(b).
- Fund shall give Riksbank at least five business days’ (Stockholm) notice of its intention to draw and provide payment instructions at least two business days (Stockholm) prior to the value date by SWIFT, unless otherwise agreed.
- Fund may, after consultation with Riksbank, extend the term by an additional one-year period and thereafter, with Riksbank agreement, for additional one-year periods; total term shall not exceed four years. Notice at least one month prior to expiration required.
- Riksbank may terminate the term if Sweden, the Riksbank, or other official institution becomes a participant in an enlarged and amended New Arrangements to Borrow (“NAB”) that becomes effective after this agreement.

### 3. Uses, Estimates and Limits on Drawings
- Permitted uses:
  - (i) any use of Fund resources in the General Resources Account; or
  - (ii) payment of the Fund’s outstanding indebtedness under other official sector borrowing effected pursuant to Article VII, Section 1(i) of the Fund’s Articles of Agreement, where terms permit such drawings.
- Drawing limits:
  - Not more than the equivalent of SDR 0.3 billion during any calendar week, unless otherwise agreed.
  - Not more than the equivalent of SDR 1 billion during any calendar month, unless otherwise agreed.
  - No drawing if it would result in total outstanding drawings under this agreement exceeding EUR 2.47 billion at the time of such drawing (calculated pursuant to paragraph 11(b)).
- Reporting:
  - Prior to each quarter of the Fund’s financial year, the Fund shall provide Riksbank its best estimates of expected drawings for the forthcoming quarter and revised estimates during each quarter where warranted.

### 4. Evidence of Indebtedness
- At Riksbank request, Fund shall issue non-negotiable instruments evidencing indebtedness; form to be agreed.
- Upon repayment of an instrument and all accrued interest, instrument returned for cancellation; if partially repaid, a new instrument for the remainder with the same maturity date shall be substituted.

### 5. Maturity
- Each drawing shall have a maturity date of three months from the drawing date, except as provided in paragraph 5 and paragraph 9.
- Fund may elect to extend the maturity date by additional periods of three months after the initial maturity date; such extension is automatically deemed elected for all outstanding drawings unless Fund notifies Riksbank at least five business days (Stockholm) before a maturity date that it does not elect to extend.
- No drawing’s maturity may be extended later than the fifth anniversary of the date of such drawing.
- Fund shall repay principal on the applicable maturity date.
- Fund may make early repayment in part or in full after consultation with Riksbank.
- Repayments restore pro tanto the amount available to be drawn; extensions do not reduce the drawable amount.
- If maturity date is not a business day in the place of payment, payment date will be the next business day there and interest accrues up to the payment date.

### 6. Rate of Interest
- Each drawing bears interest at the SDR interest rate established by the Fund pursuant to Article XX, Section 3 of the Fund’s Articles of Agreement.
- Exception: if the Fund pays a higher interest rate on outstanding balances from any other comparable borrowing effected pursuant to Article VII, Section 1(i), the interest rate payable on drawings under this agreement shall be equivalent to that higher rate for as long as it remains in effect.
- Interest calculated on outstanding amount; accrues daily and is paid promptly after each July 31, October 31, January 31 and April 30.

### 7. Denomination, Media and Modalities of Drawings and Payments
- Drawings and repayments denominated in SDRs.
- Unless otherwise agreed, Riksbank pays each drawing by transfer of the SDR equivalent amount of Swedish kronor to the Fund’s account at the Riksbank on the value date specified in Fund’s notice under paragraph 2.
- Except as provided in paragraph 9 and unless otherwise agreed, Fund’s principal repayments shall be made in Swedish kronor.
- Interest payments shall normally be made in SDRs; Fund and Riksbank may agree interest payments in Swedish kronor or any freely usable currency.
- Payments in Swedish kronor to an account specified by Riksbank; payments in SDRs by crediting Sweden’s account in the Special Drawing Rights Department; payments in other currencies to an account specified by Riksbank.

### 8. Termination of Drawings at Request of the Riksbank
- Riksbank’s commitment to meet drawings shall be terminated at Riksbank request if:
  - (i) Riksbank represents that Sweden’s balance of payments and reserve position does not justify further drawings; and
  - (ii) Fund, giving that representation the overwhelming benefit of any doubt, determines no further drawing should be made in light of Sweden’s balance of payments and reserve position.

### 9. Early Repayment at Request of the Riksbank
- At Riksbank request, Riksbank shall obtain early repayment at face value of all or a portion of outstanding drawings if:
  - (i) Riksbank represents that Sweden’s balance of payments and reserve position justifies such repayment; and
  - (ii) Fund, giving that representation the overwhelming benefit of any doubt, determines there is a need for early repayment as requested.
- After consultation, Fund may make repayments pursuant to this paragraph in SDRs or a freely usable currency as determined by the Fund.

### 10. Transferability
- General rule: Riksbank may not transfer obligations or claims resulting from outstanding drawings except with prior Fund consent.
- Exceptions (Riksbank may transfer at any time all or part of any claim 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”);
  - any official entity prescribed as a holder of SDRs pursuant to Article XVII, Section 3.
- Conditions on transferees:
  - Transferee assumes Riksbank’s liability pursuant to paragraph 5(a) regarding extension of maturity of transferred claims.
  - Transferred claim held on same terms except:
    - (i) transferee acquires right to request early repayment under paragraph 9 only if it is a member or central bank/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 for its currency to be used in transfers under the Financial Transactions Plan;
    - (ii) reference to Swedish kronor in paragraph 7 deemed to refer to transferee’s currency if transferee is a member or the central bank/other fiscal agency of a member; otherwise deemed to refer to a freely usable currency determined by the Fund;
    - (iii) payments related to the transferred claim to an account specified by the transferee;
    - (iv) references to business days (Stockholm) deemed to refer to business days in the place where the transferee is situated.
- Price of a transferred claim determined by agreement between Riksbank and transferee.
- Riksbank shall notify Fund promptly of details of any transfer (claim amount, transferee name, agreed price, value date).
- Transfer becomes effective in Fund records if in accordance with paragraph 10; effective as of agreed value date.
- If claim transferred during a quarterly period as described in paragraph 6(b), Fund shall pay interest to the transferee on the transferred amount for the whole of that period.
- Fund shall assist in seeking to arrange transfers if requested.

### 11. Effective Exchange Rate
- Unless otherwise agreed, all drawings, exchanges, and payments under this agreement made at exchange rates for relevant currencies in terms of the SDR established pursuant to Article XIX, Section 7(a) and Fund rules 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 Stockholm, the date shall be the last preceding business day of the Fund that is also a business day in Stockholm.
- For applying the limit on drawings in paragraphs 1 and 3(c), 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 XIX, Section 7(a) and Fund rules for the second business day of the Fund before the value date. If that date is not a business day in Stockholm, it shall be the last preceding business day of the Fund that is also a business day in Stockholm.

### 12. 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.

### 13. Non-Subordination of Claims
- Fund agrees not to take any action that would make Riksbank’s claims resulting from outstanding drawings under this agreement subordinate in any way to claims resulting from any other borrowing effected pursuant to Article VII, Section 1(i).

### 14. Settlement of Questions
- Any question arising under this agreement shall be settled by mutual agreement between the Riksbank and the Fund.

*Source: Borrowing Agreement between the Swedish Riksbank and the International Monetary Fund (Content unit: _040710)*

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_Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/np/pp/eng/2010/_040710.pdf_