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The IMF Financial Operations provides a broad introduction to how the IMF fulfills its mission through its financial activities. It covers the financial structure and operations of the IMF and also provides background detail of the financial statements for the IMF’s activities during the most recent financial year.

Chapter 1: Overview of the IMF as a Financial Institution
The International Monetary Fund was founded some 70 years ago near the end of World War II. The founders aimed to build a framework for economic cooperation that would forestall the kinds of economic policies that contributed to the Great Depression of the 1930s and the global conflict that ensued. The world has changed dramatically since 1944, bringing extensive prosperity to many countries and lifting millions out of poverty. The IMF has evolved as well, but in many ways its main purpose— to support the global public good of financial stability and prosperity—remains the same today as when the organization was established.

Chapter 2: Nonconcessional Financial Operations
The IMF resources are held in the General Department, which consists of three separate accounts: the General Resources Account (GRA), the Special Disbursement Account (SDA), and the Investment Account (IA). The GRA is the principal account of the IMF and handles by far the largest share of transactions between the IMF and its members. The GRA can best be described as a pool of currencies and reserve assets largely built from members’ fully paid capital subscriptions in the form of quotas.

Chapter 3: Financial Assistance for Low-Income Countries
The IMF’s financial assistance for low-income countries (LICs) is composed of concessional loans and debt relief.

Concessional lending began in the 1970s and has expanded since. In July 2009, the IMF’s Executive Board approved a comprehensive reform of the IMF’s concessional facilities. Such assistance is now provided through the facilities of the Poverty Reduction and Growth Trust (PRGT), which assists eligible countries in achieving and maintaining a stable and sustainable macroeconomic position consistent with strong and durable poverty reduction and growth.

Chapter 4: Special Drawing Rights
Special drawing rights (SDRs) were created in 1969 as an international reserve asset to supplement other reserve assets whose growth was inadequate to finance the expansion of international trade and finances under the Bretton Woods system in the postwar period and to support the Bretton Woods fixed exchange rate system. The creation of the SDR was intended to make the regulation of international liquidity subject, for the first time, to international consultation and decision. The SDR is not a currency, nor is it a claim on the IMF. Instead, it is a potential claim on the freely usable currencies of IMF members. The IMF may allocate SDRs unconditionally to members (participants) who may use them to obtain freely usable currencies in order to meet a balance of payments need without undertaking economic policy measures or repayment obligations.

Chapter 5: The IMF's Income Model
This chapter explains the sources of income for the IMF. It elaborates on how the IMF has adapted its financial structure to finance its administrative expenditures. The IMF’s income is generated primarily through its lending and investing activities (Figure 5.1). Since its inception, the IMF has relied primarily on lending activities to fund its administrative expenses. Lending income is derived from the fees and charges levied on the use of credit from the General Resources Account (interest on loans). In addition to the basic rate of charge, the use of IMF credit is subject to surcharges under certain circumstances, and all IMF credit is subject to service charges and commitment fees on credit lines. A small amount of income is also generated by receipts of interest on the IMF’s holdings of Special Drawing Rights (SDRs).

Chapter 6: Financial Risk Management
The IMF’s Articles of Agreement call for adequate safeguards for the temporary use of its resources. Risks stem from interactions with the membership in fulfillment of the IMF’s mandate as a cooperative international organization that makes its general resources available temporarily to its members. The IMF has an extensive risk-management framework in place, including procedures to mitigate traditional financial risks as well as strategic and operational risks. The latter risks are addressed by a variety of processes, including surveillance reviews, lending policies and operations, capacity building, standards and codes of conduct for economic policies, the communications strategy, and others.

Appendix 1: IMF Membership: Quotas, and Allocations and Holdings of SRDs

Appendix 2: Special Voting Majorities for Selected Financial Decisions

Appendix 3: Other Administered Accounts

Appendix 4: Disclosure of Financial Position with the IMF in the Balance Sheet of a Member's Central Bank

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