REPORT TO CONGRESS ON FINANCIAL IMPLICATIONS OF 

U.S. PARTICIPATION IN 

THE INTERNATIONAL MONETARY FUND

Q1 – Q4 FY2010 and Q1 FY2011

This report has been prepared in compliance with Section 504(b) of Appendix E, Title V of 

the Consolidated Appropriations Act for FY 2000, Public Law No. 106-113 (Nov. 29, 1999).

The report focuses exclusively on the financial implications of U.S. participation in the 

International Monetary Fund (IMF) and does not attempt to quantify the broad and substantial 

economic benefits to the United States and the global economy resulting from U.S. 

participation in the IMF.1

As required, the report provides financial information on the net interest income and valuation 

changes associated with U.S. participation in the IMF. The broader context for the financial 

implications of U.S. participation in the IMF and the methodology used in deriving these 

figures has been laid out in previous reports. The methodology is also summarized briefly in 

the footnotes attached to the tables. Reports prepared under Section 504(b) are made 

available to the public on the Treasury website: http://www.treasury.gov/resourcecenter/international/int-monetary-fund/Pages/imf.aspx.

This report provides quarterly data for the full fiscal year 2010 and the first quarter of fiscal 

year 2011.2

 It provides information on U.S. participation in the IMF’s General Department as 

well as information related to U.S. holdings of Special Drawing Rights (SDRs) as part of its 

international reserves and the financial implications of U.S. participation in the SDR 

Department of the IMF.3

Data on the net interest income and valuation changes related to U.S. participation in the 

IMF’s General Department during the first to fourth quarters of fiscal year 2010 and the first 

quarter of fiscal year 2011 are provided in Table 1. For comparison purposes, previouslyreported data for the last two fiscal years are also provided.

 1 Section 504(b) of Appendix E, Title V of the Consolidated Appropriations Act for FY 2000, Public Law 106-

113, 113 Stat. 1501A-317, requires that the Secretary of the Treasury prepare and transmit to the appropriate 

committees of the Congress a quarterly report on United States participation in the International Monetary Fund 

(IMF), detailing the costs or benefits to the United States as well as valuation gains or losses on the United 

States’ reserve position in the IMF.

2 Data for the first quarter of fiscal year 2010 was presented in the last report under Section 504(b), but is 

included in this report for ease of presentation. 

3 The SDR is an international reserve asset created by the IMF. The SDR is used as a unit of account by the IMF 

and other international organizations. Its value is determined as a weighted average of a basket of currencies --

the dollar, euro, pound sterling, and yen. The SDR carries a market-based interest rate determined on the basis 

of a weighted average of interest rates on short-term instruments in the markets of the currencies included in the 

SDR valuation basket.
Similarly, data for net interest income and valuation changes related to U.S. participation in 

the SDR Department of the IMF during the first to fourth quarters of fiscal year 2010 and the 

first quarter of 2011 are provided in Table 2. For comparison purposes, data for the last two 

fiscal years are also provided.

The footnotes to the tables explain the columns shown and provide pertinent information and 

assumptions used in the calculations.

As shown in Table 1, for the first to fourth quarters of fiscal year 2010 and the first quarter of 

fiscal year 2011, the financial implications of U.S. participation in the General Department 

reflected a net interest income effect of negative $43 million. The valuation change in the 

U.S. Reserve Position for the first to fourth quarters of fiscal year 2010 and the first quarter of 

fiscal year 2011 was negative $291 million.4

 

As shown in Table 2, for the first to fourth quarters of fiscal year 2010 and the first quarter of 

fiscal year 2011, the net interest income effect of U.S. participation in the SDR Department 

was negative $12 million. The valuation change on U.S. SDR holdings for the first to fourth 

quarters of fiscal year 2010 and the first quarter of fiscal year 2011 was negative $63 million.5

Over the period fiscal year 2000 through fiscal year 2010, the average annual net interest 

income effect of U.S. participation in the General Department was positive $41 million, while 

the cumulative net interest income effect was positive $451 million. During the same period, 

the average annual valuation change in the U.S. Reserve Position was positive $206 million, 

while the cumulative valuation change was positive $2,265 million.

Over the period fiscal year 2000 through fiscal year 2010, the average annual net interest 

income effect of U.S. participation in the SDR Department was negative $6 million, while the 

cumulative net interest income effect was negative $65 million. During the same period, the 

average annual valuation change on U.S. SDR holdings was positive $44 million, while the 

cumulative valuation change was positive $485 million. 

Attachments

 4 For an explanation of the methodology used in deriving these figures, see the section on “Calculating the 

Financial Implications of U.S. Participation in the General Department” in the report prepared for the fourth 

quarter of fiscal year 2000, submitted in December 2000 and available at http://www.treasury.gov/presscenter/press-releases/Pages/report3073.aspx. 5 For an explanation of the methodology used in deriving these figures, see the section on “Calculating the 

Financial Implications of U.S. Participation in the SDR Department” in the report prepared for the fourth quarter 

of fiscal year 2000, submitted in December 2000 and available at http://www.treasury.gov/press-center/pressreleases/Pages/report3073.aspx.

TABLE 1

Footnotes to Columns 

Column 1: Total cumulative transactions under the U.S. quota, including drawings by the IMF under 

the Letter of Credit (75% portion of the U.S. quota) and the transfers of reserve assets to the IMF 

(generally 25% of the U.S. quota). This does not include cumulative valuation changes.

Column 2: Total cumulative dollar funding through loans to the IMF made by the U.S. under the 

Supplementary Financing Facility (SFF, in 1980), the General Arrangements to Borrow (GAB, in 

FY1998) and the New Arrangements to Borrow (NAB, in FY1999). All U.S. loans under the three 

facilities/arrangements have been repaid. U.S. loans under the SFF were repaid in 1990, and the SFF 

was subsequently closed out. 

Column 3: Total cumulative U.S. transactions with the IMF (horizontal summation of columns 1 and 

2).

Column 4: Total interest expense associated with total cumulative transactions shown in column 3. 

This includes interest paid on incremental public borrowing to fund the IMF's use of dollars under the 

Letter of Credit and any transfer of dollars to the IMF under loan arrangements (SFF, GAB, NAB), as 

well as interest income forgone on reserve assets transferred to the IMF at the time of a quota increase. 

As Treasury increases its net borrowing from the public in order to provide resources to the IMF under

the Letter of Credit or loan arrangements, the interest cost associated with such borrowing is 

calculated using Treasury's average cost of funds. This interest cost enters the federal budget as part 

of interest on the public debt. For purposes of calculating forgone interest on the transfer of reserve 

assets to the IMF, the SDR interest rate is used.

Column 5: The U.S. reserve position in the IMF is an interest-earning asset of the Treasury General 

Account (TGA). This interest ("remuneration") is paid by the IMF every IMF fiscal quarter and is 

recorded in the budget as a negative outlay. The IMF normally pays remuneration in SDRs, which 

become resources of the Exchange Stabilization Fund (ESF). In return, the ESF transfers an 

equivalent dollar amount to the TGA. The transfer of dollars from the ESF to the TGA has no effect 

on Treasury's cash position. If the United States were to request payment in dollars, the payment 

would be in the form of a decrease in the U.S. Letter of Credit and a counterpart increase in the U.S. 

reserve position, but no flow of cash to the TGA.

Column 6: These amounts constitute the interest payments the United States has received on its loans 

to the IMF under the SFF, GAB, and NAB. 

Column 7: Total net interest paid, forgone or received as a result of U.S. participation in the General 

Department of the IMF.

Column 8: The U.S. reserve position in the IMF is denominated in SDRs. The valuation gain (if 

positive) or loss (if negative) refers to the exchange rate gain or loss on the reserve position due to 

changes in the dollar value of the SDR. For example, if the SDR appreciates/dollar depreciates, then 

the dollar value of the reserve position rises and a valuation gain is recorded. This column would also 

include valuation gains or losses experienced as a result of U.S. loans under the SFF, GAB and NAB.

Column 9: The total of net interest and valuation changes, obtained by summing column 7 and 

column 8. 

TABLE 2

Footnotes to Columns 

Column 1: Total stock of U.S. holdings of SDRs measured at the end of period, converted into dollars 

at the end of period exchange rate. Source: IMF.

Column 2: Total stock of U.S. SDR allocations measured at the end of period, converted into dollars at 

the end of period exchange rate. Changes in the dollar value of cumulative SDR allocations reflect

new SDR allocations as well as exchange rate changes. During Q4 2009, as a result of a general SDR 

allocation on August 31, 2009, and a special SDR allocation on September 9, 2009, cumulative U.S. 

SDR allocations increased by SDR 27,539,140,146 and SDR 2,877,010,667, respectively. Source: 

IMF.

Column 3: Total stock of U.S. SDR holdings minus allocations measured from end of period (Column 

2 minus Column 3), converted into dollars at the end of period exchange rate. 

Column 4: Net interest earned on SDR holdings. Derived by subtracting actual charges on SDR 

allocations from actual interest earned on SDR holdings. 

Column 5: Net effect on U.S. borrowing costs of cumulative net SDR holdings, derived by multiplying 

the dollar equivalent of cumulative net SDR holdings by Treasury’s average cost of funds rate. 

Interest is calculated on the basis of end-quarter holdings and compounded quarterly. 

Column 6: Net interest income (Column 5 plus Column 6).

Column 7: The valuation change refers to the gain or loss over the period on the reserve position due 

to changes in the dollar value of the SDR. For example, if the SDR appreciates/dollar depreciates, 

then the impact on the dollar value of U.S. holdings of SDRs is positive, and a valuation gain is 

recorded. The change is calculated by subtracting the beginning of period dollar value of SDR 

reserves from the same SDR reserve figure converted to dollars using the end of period exchange rate.

This isolates changes due to exchange rate movements from changes due to actual SDR transactions 

over the period.

Column 8: The total net interest and valuation changes (sum of Columns 7 and 8).