TheCable

The executive board of the International Monetary Fund (IMF) after its annual review says the fund beats its own projected income for the year 2017 as it raked in $2.3 billion.

According to the board, the fund’s income position for the financial years ending April 30, 2017 (FY 2017) and FY 2018, on April 26, 2017 reflects higher income.

“Total FY 2017 net income, including income from surcharges applied to higher access borrowing from the IMF, is estimated at SDR 1.7 billion (US$2.3 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 16.4 billion (US$22.5 billion) at end-FY 2017,” the board said via a statement.

“The net income position for FY 2017 is higher than estimated a year earlier. This reflects the amended IAS (International Accounting Standard) 19 adjustment, relating to reporting of employee benefits, and higher investment income.”

For the 2018 fiscal year, “net income of SDR 0.7 billion (US$1 billion) is projected for FY 2018”.

“This projection is sensitive to the timing and amounts of disbursements under approved arrangements included in the projections, possible new arrangements, the performance of the Fund’s investment portfolio, and the annual pension expense as determined under IAS 19. The projected net income will allow the IMF to continue to add to its 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 2016, the Executive Board set the margin for this rate of charge at 100 basis points for financial years FY 2017 and FY 2018.

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.