{
  "title": "Fiscal-Risks-Toolkit-DGAT — DEBT GUARANTEES AND LOANS ASSESSMENT TOOL (DGLAT)",
  "sourceUrl": "https://www.imf.org/en/topics/fiscal-policies/fiscal-risks/fiscal-risks-toolkit/fiscal-risks-toolkit-dgat",
  "canonical": "https://www.imf.org/en/topics/fiscal-policies/fiscal-risks/fiscal-risks-toolkit/fiscal-risks-toolkit-dgat",
  "overlayPath": "/en/topics/fiscal-policies/fiscal-risks/fiscal-risks-toolkit/fiscal-risks-toolkit-dgat/index.md",
  "summary": "The tool focuses on the creditworthiness of the obligor, rather than the viability of the project for which the financing will be used, and aims to inform the decision to issue a guarantee or provide a loan as well as support the management of the loan and guarantee portfolios.",
  "sections": [
    {
      "heading": "Purpose and scope",
      "content": "- Analyzes loans or explicit debt guarantees to support debt raised by a public or private sector company on a corporate finance basis, where lenders have recourse to the cash flows and assets generated by the company as a whole.\n- Focuses on the creditworthiness of the obligor, rather than the viability of the project for which the financing will be used.\n- Aims to inform the decision to issue a guarantee or provide a loan and to support the management of loan and guarantee portfolios."
    },
    {
      "heading": "Key functions and analytical features",
      "content": "- Estimates the expected fiscal costs and risks from individual government loans or debt guarantees on borrowing of non-financial entities.\n- Uses a credit scoring approach to assign a risk rating to each entity based on their financial health and underlying business risk characteristics.\n- Provides analysis of:\n  - the government's maximum fiscal exposure, and\n  - estimates of expected fiscal costs based on input assumptions.\n- Incorporates analysis under different scenarios."
    },
    {
      "heading": "Rationale for analyzing loans and guarantees",
      "content": "- Public loans and guarantees create substantial fiscal risk.\n- IMF Public Sector Balance Sheet Database findings:\n  - the general government loan portfolio averages 6.5 percent of GDP across a group of 49 countries,\n  - and is as large as 20 percent of GDP in some of them.\n- Governments provide loans and guarantees to address market failures, reduce borrowing costs for entities, and support project financing.\n- During crises, loans and guarantees can support macroeconomic stability by ensuring the flow of credit during periods of severe market disruption or economic stress.\n- Loans and guarantees often do not impact fiscal balances immediately but can expose governments to future costs:\n  - loans can produce balance sheet losses and increase the government's financing burden if they cannot be serviced,\n  - government guarantees create contingent liabilities that result in future fiscal costs if called.\n- These risks should be understood, assessed, monitored, and transparently reported."
    },
    {
      "heading": "How the tool supports fiscal policymaking (uses and policy implications)",
      "content": "- Inform decisions on whether to extend a public loan or issue a government guarantee.\n- Support ongoing risk monitoring of the government's loan and guarantee portfolio.\n- Inform risk mitigation measures.\n- Support the setting of risk-based fees.\n- Identify budget provisions that may need to be made.\n- Assist cash and debt management and fiscal sustainability analysis.\n- Provide the basis for accounting, reporting, and disclosing risks (e.g., in debt reports, financial statements, and fiscal risk statements).\n- Support macro-fiscal analysis to include fiscal costs and risks in baseline and shock scenarios for debt sustainability analysis, cash and debt management, and other macro-fiscal tools."
    },
    {
      "heading": "Linkages to other IMF fiscal risk and macro-fiscal analytical tools",
      "content": "- Complementary to the Standardized Guarantee and Loan Assessment Tool (SGAT): \n  - SGAT focuses on guarantee and loan schemes, while DGLAT focuses on discrete guarantees and loans.\n- Builds on, and is consistent with, the methodological approach used for the SOE Health Check Tool and can be completed by the SOE Stress Test Tool.\n- Outputs can help inform inputs for other IMF tools, including:\n  - the Fiscal Risk Assessment Tool;\n  - Fiscal Stress Test;\n  - Public Sector Balance Sheet Assessments;\n  - the IMF's Debt Sustainability Analysis, by informing the size of potential contingent liability realizations from guarantee calls and the balance sheet implications from loan exposures."
    }
  ],
  "bullets": [
    "Analyzes loans or explicit debt guarantees to support debt raised by a public or private sector company on a corporate finance basis, where lenders have recourse to the cash flows and assets generated by the company as a whole.",
    "Focuses on the creditworthiness of the obligor, rather than the viability of the project for which the financing will be used.",
    "Aims to inform the decision to issue a guarantee or provide a loan and to support the management of loan and guarantee portfolios.",
    "Estimates the expected fiscal costs and risks from individual government loans or debt guarantees on borrowing of non-financial entities.",
    "Uses a credit scoring approach to assign a risk rating to each entity based on their financial health and underlying business risk characteristics.",
    "Provides analysis of:",
    "Incorporates analysis under different scenarios.",
    "Public loans and guarantees create substantial fiscal risk.",
    "IMF Public Sector Balance Sheet Database findings:",
    "Governments provide loans and guarantees to address market failures, reduce borrowing costs for entities, and support project financing.",
    "During crises, loans and guarantees can support macroeconomic stability by ensuring the flow of credit during periods of severe market disruption or economic stress.",
    "Loans and guarantees often do not impact fiscal balances immediately but can expose governments to future costs:",
    "These risks should be understood, assessed, monitored, and transparently reported.",
    "Inform decisions on whether to extend a public loan or issue a government guarantee.",
    "Support ongoing risk monitoring of the government's loan and guarantee portfolio.",
    "Inform risk mitigation measures.",
    "Support the setting of risk-based fees.",
    "Identify budget provisions that may need to be made.",
    "Assist cash and debt management and fiscal sustainability analysis.",
    "Provide the basis for accounting, reporting, and disclosing risks (e.g., in debt reports, financial statements, and fiscal risk statements).",
    "Support macro-fiscal analysis to include fiscal costs and risks in baseline and shock scenarios for debt sustainability analysis, cash and debt management, and other macro-fiscal tools.",
    "Complementary to the Standardized Guarantee and Loan Assessment Tool (SGAT):",
    "Builds on, and is consistent with, the methodological approach used for the SOE Health Check Tool and can be completed by the SOE Stress Test Tool.",
    "Outputs can help inform inputs for other IMF tools, including:"
  ],
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  "generatedAtUtc": "2026-10-01T18:11:24.076Z"
}