## Technical Note on Synchronized Approval of Flexible Credit Lines for Multiple Countries

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**Canonical URL:** [Technical Note on Synchronized Approval of Flexible Credit Lines for Multiple Countries](https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/np/pp/eng/2010/_111110.pdf)

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### Purpose and scope
- Sketches procedures under which synchronized approval of Flexible Credit Line (FCL) arrangements for multiple member countries could be undertaken under the existing FCL Decision and other Fund policies.
- Does not modify existing Fund policies, nor establishes a new financing instrument.
- Rationale: When multiple members face the same shock, synchronized approval of FCL arrangements could strengthen the effectiveness of the response to the common shock and minimize first-mover problems.
- Each member’s qualification for the FCL would be assessed individually and only after the member has affirmatively expressed interest in the FCL; synchronized requests/approvals remain subject to all requirements in the FCL Decision and other Fund policies.

### Confidentiality and Board authority
- Confidentiality requirement: Discussions with members about potential use of, and qualification for, the FCL must preserve confidentiality as required in the FCL Decision (¶6).
- Only the Executive Board has the authority to determine qualification or to approve FCL arrangements, as recommended by management.
- Informal staff and management discussions:
  - Would not confirm that any particular member would qualify for an FCL arrangement.
  - Would not reveal that any other member has expressed interest in the FCL, unless the member(s) that has already expressed interest has agreed that such information can be shared.

### Synchronized FCL procedures and Board consultation
- If a number of members express interest in synchronized financial assistance under FCL arrangements and management decides access may be appropriate for each member, the Executive Board will be promptly consulted in an informal meeting.
- Expedited approval procedures could be followed consistent with the FCL Decision.
- Synchronized consideration and approval:
  - Governed by the same policies and requirements currently in place under the FCL Decision for each member.
  - Governed by standard procedures and practices for issuance of Board documents and conduct of Board meetings.
- Reference on expedited timelines: The FCL Decision (¶6(a)(v)) states that minimum periods applicable to circulation of staff reports shall apply to FCL arrangement requests, provided the Executive Board will generally be prepared to consider a request within 48 to 72 hours after the circulation of the documentation in exceptional circumstances, such as an urgent actual balance of payments need.

### External communications
- If concerns arise about a market-sensitive leak or misinformation about the FCL requests, management could issue a short press statement following the initial informal Board meeting indicating the concurrent request of FCL arrangements, provided the relevant members agree to it.
- The press statement will take special care not to prejudge the Board’s exercise of its responsibility to take the final Decision on the FCL arrangements.
- Operational guidance reference: See The Flexible Credit Line—Guidance on Operational Issues.

### Access
- General Fund policies for duration and access under FCL arrangements apply when synchronized approval procedures are used.
- Proposed access levels:
  - Based on a rigorous assessment of each member’s actual or potential balance of payments need and capacity to repay.
  - Will take into account the individual and cumulative impact of the access requests on Fund resources (¶6(a)(iii)(I) and (II) of the FCL Decision).

### Safeguards and liquidity considerations
- Concurrently approved FCL arrangements could have important implications for Fund resources and liquidity management depending on individual and collective size.
- Recently strengthened procedural requirements call for early Board involvement in assessing contemplated access and its impact on Fund liquidity, in the context of other potential demand for Fund resources.
- Added safeguard: Staff intends to include a liquidity assessment in the staff note (or notes) for the initial informal Board meeting whenever total access across the proposed arrangements would exceed SDR 10 billion, even if no individual arrangement contemplates access above this threshold.

*Technical Note on Synchronized Approval of Flexible Credit Lines for Multiple Countries (content unit _111110)*

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_Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/np/pp/eng/2010/_111110.pdf_