"This paper reports the Fund’s income position for FY 2018 following the closing of the Fund’s accounts for the financial year and completion of the external audit. Total FY 2018 net income, including income from surcharges, amounted to SDR 0.78 billion or SDR 94 million higher than estimated in April, reflecting mainly a larger than anticipated gain reported under IAS 19 (the accounting standard for employee benefits). GRA net income for FY 2018 was about SDR 0.76 billion and has been placed to the Fund’s reserves. In accordance with decisions taken in April 2018, a net transfer of currencies amounting to SDR 0.67 billion was made in early August 2018 from the GRA to the Investment Account. The placement of the net income to the Fund’s reserves has further strengthened the Fund’s precautionary balances, which reached SDR 17.5 billion at the end of FY 2018."
"This paper reports the Fund’s income position for FY 2017 following the closing of the Fund’s accounts for the financial year and completion of the external audit. Total FY 2017 net income, including income from surcharges, amounted to SDR 1.9 billion or about SDR 258 million higher than estimated in April, reflecting mainly a larger than anticipated gain reported under IAS 19 (the accounting standard for employee benefits). GRA net income for FY 2017 was about SDR 1.49 billion and has been placed to the Fund’s reserves. In accordance with decisions taken in April 2017, a net transfer of currencies amounting to SDR 1.41 billion was made in August 2017 from the GRA to the Investment Account. The placement of the net income to the Fund’s reserves has further strengthened the Fund’s precautionary balances, which reached SDR 16.7 billion at the end of FY 2017."
"The Fund’s total net income for FY 2018 is projected at about SDR 0.7 billion, broadly in line with the April 2017 estimate. The projections for total lending income are broadly unchanged. Most sources of lending income are lower, reflecting a lower level of credit outstanding as a result of advance repurchases and delayed disbursements. However, projected commitment fee income is higher following the early cancellation of a large FCL arrangement in November 2017. The paper recommends that GRA net income of SDR 0.7 billion for FY 2018 (excluding projected income of the gold sales profits-funded Endowment Subaccount) be placed to the special and general reserve. After the placement of GRA FY 2018 net income to reserves, precautionary balances are projected to reach SDR 17.4 billion at the end of FY 2018. The paper further proposes to transfer currencies equivalent to the increase in the Fund’s reserves from the GRA to the Investment Account. The paper also revisits options for the allocation of net income between the special and general reserve, and proposes that net income be allocated equally between the special and general reserve. In line with the recent Board discussion of a framework for guiding future payouts from the Endowment Subaccount, the paper presents a detailed proposal, which includes delaying payouts for three years to protect the real value of the Endowment. The paper also recommends that the margin for the rate of charge for the period FY 2019–2020 be kept unchanged at 100 basis points. The margin will again be set under the exceptional circumstances clause, as non-lending income continues to be constrained by the low interest rate environment and lending income will be used to finance a portion of the Fund’s non-lending activities. The projections for FY 2019 and FY 2020 point to a net income position of SDR 0.4 billion and SDR 1 billion, respectively. These projections are subject to considerable uncertainty and are sensitive to a number of assumptions."
This paper reports the Fund’s income position for FY 2016 following the closing of the Fund’s accounts for the financial year and completion of the external audit. FY 2016 net income, including income from surcharges, was unchanged from the amount of SDR 998 million projected in April. GRA net income for FY 2016 of about SDR 1 billion has been placed to the Fund’s reserves, further strengthening the Fund’s precautionary balances, which reached SDR 15.2 billion at the end of FY 2016. Following the completion of the Executive Board’s review of the investment strategy for the Fixed-Income Subaccount and consistent with the discussions in April, currencies totaling about SDR 3.7 billion will be transferred to the Investment Account during September and October 2016. This comprises currencies equivalent to the net income retained in the GRA in FY 2014 (SDR 1.2 billion) and FY 2015 (SDR 1.5 billion), together with the currencies equivalent to the FY 2016 GRA net income of about SDR 1 billion.
On April 27, 2020, the Executive Board of the International Monetary Fund (IMF) approved the IMF’s administrative and capital budgets for financial year (FY) 2021, beginning May 1, 2020, and took note of indicative budgets for FY 2022–23.
The Fund’s total net income for FY 2017, including surcharges, is projected at about SDR 1.7 billion or some SDR 0.7 billion higher than expected in April 2016. This mainly reflects the IAS 19 adjustment (relating to reporting of employee benefits), which is expected to contribute about SDR 0.4 billion to net income, and higher investment income. Lending income is expected to be modestly lower than the April 2016 estimates. The paper recommends that GRA net income of SDR 1.2 billion for FY 2017 (which excludes projected income of the gold endowment), be placed equally to the special and general reserve. After the placement of GRA FY 2017 net income to reserves, precautionary balances are projected to reach SDR 16.4 billion at the end of FY 2017. The paper further proposes to transfer currencies equivalent to the increase in the Fund’s reserves from the GRA to the Investment Account. In April 2016, the margin for the rate of charge was set at 100 basis points for the two years FY 2017 and FY 2018. The margin may be adjusted before the end of the first year of this two-year period (i.e., FY 2017) but only if warranted by fundamental changes in the underlying factors relevant for the establishment of the margin at the start of the two-year period. Staff does not propose a change in the margin. The projections for FY 2018 point to a net income position of SDR 0.7 billion. These projections are subject to considerable uncertainty and are sensitive to a number of assumptions.
This paper reviews the Fund’s income position for FY 2019 and FY 2020. The paper updates projections provided in April 2018 and proposes decisions for the current year. The paper includes a comprehensive review of the Fund’s income position as required under Rule I-6(4). No change is proposed in the margin for the rate of charge that was established under this rule in April 2018 for the period FY 2019–20.
The medium-term income projections have been updated since the last estimate provided to the Executive Board in April 2013. Lending income is higher compared with the earlier estimates as a result of new arrangements approved since April 2013. Non-lending income is lower primarily due to revised projections for investment income. The updated expenditure path assumes the net administrative budget remains constant in real terms at the FY 2014 level, implying a nominal medium-term path that is somewhat higher than in the April 2013 projections. Precautionary balances are projected to reach the current target of SDR 20 billion in FY 2018. The projections also illustrate a broad balance between income and expenditures even if lending were to return to pre-crisis levels.
This paper updates the projections of the Fund’s income position for FY 2023 and FY 2024 and proposes related decisions for the current and next financial year. The paper also includes a proposed decision to keep the margin for the rate of charge unchanged for financial year 2024. The Fund’s overall net income for FY 2023 is projected at about SDR 1.8 billion, slightly lower than the April 2022 estimate.
The Fund has been operating under a flat real resource envelope for the past six years. With continued efforts to maximize the use of available resources, spending in FY 17 is projected to reach 99 percent of the net administrative budget, and a low vacancy rate has helped stabilize overtime at 11 percent. Internal savings and reallocations have allowed the Fund to dedicate more resources to country work, including capacity development, without requiring an increase in the approved budget—apart from $6 million provided in FY 17 to cover rising security costs. An unchanged real net administrative budget in FY 18, despite deeper Fund engagement in a number of areas, as well as increased costs for corporate modernization. Accordingly, the budget proposal incorporates significant savings from reallocations and efficiency gains to fund new demands, as well as a further increase in the upfront allocation of carry-forward funds by about $10 million. The broad themes of the proposal are: (i) more intensive country work with a shift from surveillance to programs, but net savings in field offices; (ii) significant policy and analytical work on the financial sector and the role of the Fund (global safety net, facilities, and quotas), albeit less than in FY 17, with more work on structural issues and new challenges; (iii) funding for transforming IT and HR services, offset by central savings; and (iv) enhanced risk mitigation and knowledge management (KM), with the establishment of a KM unit to support cross-country analysis and knowledge transfer. At this stage, a flat resource envelope is assumed also for the medium term, contingent on continued reprioritization and a broadly unchanged global economic environment. Upward pressure on resources will arise from growing capacity development activities and certain revenue losses. Savings are expected from the TransformIT initiative and internal efficiency gains. But for the budget to remain flat, the Fund will need to continuously reprioritize and adjust its activities to make room for new demands. Even then, a more challenging global environment, with a further ramping up of Fund lending, or significant demands for deeper engagement in other areas, would put significant strains on resources over the medium term. The proposed capital budget envelope for FY 18–20 remains broadly unchanged from current levels. Some frontloading, however, is planned for the first two years, due to the cyclical nature of these investments and to accommodate strategic IT projects.
