Press Release No. 19/256

IMF Executive Board Reviews the Fund's Income Position for Financial Years 2019–20

June 28, 2019

The Executive Board of the International Monetary Fund (IMF) completed its annual review of the Fund’s income position for the financial years ending April 30, 2019 (FY 2019) and FY 2020, on April 5, 2019.

FY 2019 Income Position

Total FY 2019 net income, including income from surcharges applied to higher access borrowing from the IMF, was projected at SDR 0.5 billion (US$0.7 billion). Net income excluding the retained earnings of the gold endowment, will be added to the IMF’s precautionary balances which are projected to reach SDR 17.7 billion (US$24.8 billion) at end-FY 2019. The net income position for FY 2019 is broadly in line with the April 2018 estimate and reflects the increase in lending and investment income; largely offset by the IAS (International Accounting Standard) 19 loss, relating to reporting of employee benefits.

FY 2020 Income Position and Lending Rate

Net income of SDR 1.7 billion (US$2.4 billion) is projected for FY 2020. The projections are subject to a high degree of uncertainty and are sensitive to the timing and amounts of disbursements under approved arrangements included in the projections, possible new arrangements, and the performance of the Fund’s investment portfolio. The projected net income will allow the IMF to continue to accumulate precautionary balances.

The IMF charges member countries a basic rate of charge on the use of IMF credit, which is determined as the SDR interest rate plus a margin expressed in basis points. In April 2018 the Executive Board set the margin for this rate of charge at 100 basis points for financial years FY 2019 and FY 2020. In the context of this year’s comprehensive review of the Fund’s income position at the midpoint of this two-year period, the Executive Board concluded that the margin should remain unchanged.

The Executive Board also adopted a number of other decisions that have a bearing on the Fund’s finances. These included decisions to transfer income from the Fixed-Income Subaccount of the Fund’s Investment Account (IA) to the General Resources Account (GRA); to place FY 2019 General Resources Account net income in equal parts to the Fund’s Special Reserve and the General Reserve; to transfer currencies from the GRA to the IA of amounts attributable to FY 2019 net operational income; and to reimburse costs to the GRA.

Special Charges Review

The annual review of the Fund’s income position amended Section VI of the 1985 decision on special charges to shift the requirement for regular review from the annual review of the Fund’s income position, to the five-yearly Review of the Fund’s Strategy on Overdue Financial Obligations.