In the event of an economic crisis, countries often need financial resources to overcome their balance of payments problems. Since its creation in June 1952, the IMF`s Stand By Arrangement (SBA) has been the workhorse for granting credit to emerging and industrialized countries. The SBA was updated in 2009, together with the fund`s broader instruments, to be more flexible and responsive to the needs of Member States. Conditions have been streamlined and simplified and more resources have been made available in advance. The reform also allows for wider access on a precautionary basis. Repayment. Repayment of funds borrowed under the SBA is due within 31/4-5 years of payment, which means that each payment is repaid in eight equal quarterly instalments from 3 1/4 years from the date of each payment. Structural measures. Once the structural performance criteria have been eliminated, progress in the implementation of structural measures essential to the achievement of the objectives of the Programme will be assessed holistically, including through benchmarks. Building on previous efforts, the IMF has continued to reform its lending conditions, based on measurable, observable, and periodic criteria, the frequency of which is based on the strength of the country`s policy and the nature of its financing needs: The IMF Stability Agreement (SBA) is an economic program of the International Monetary Fund that includes financial assistance to a member state; who needs financial support. a financial crisis. In return for the aid, the economic programme provides for the necessary reforms in the recipient country in order to put it back on the path to financial stability and economic viability.
The SBA is a subgroup of IMF and World Bank structural adjustment programs. The SBA framework allows the Fund to flexibly respond to countries` external financing needs and support their adjustment policies with short-term financing. Credit conditions. Access to IMF financing under the SA depends on a member`s financing needs, repayment capacity, and balance sheet in the use of IMF resources. Within the framework of these directives, the SBA offers flexibility with regard to the amount of loans and the date of payment. These include commitment costs. Appropriations committed under all SAs shall be subject to a commitment fee at the beginning of each 12-month period, levied on amounts which may have been used during the period (15 basis points for amounts committed up to 115% of the quota, 30 basis points for amounts committed above 115% and up to 575% of the quota and 60 basis points for amounts, which exceed 575 per cent of the quota). Those costs shall be reimbursed on a pro rata basis where the amounts are collected during the period concerned.
If the country borrows the full amount committed under an SBA, the commitment fee is reimbursed in full. However, no refunds are made under a precautionary SBA under which countries do not draw . . .