Review of the Adequacy of the Fund's Precautionary Balances

On March 20, 2026 the Executive Board of the International Monetary Fund (IMF) concluded the 2026 Review of the Adequacy of the Fund’s Precautionary Balances. This review took place on the standard two-year cycle, following the 2024 Review. An interim assessment of precautionary balances was conducted within the Review of the Fund’s Income Position for FY2025 and FY2026, concluded in April 2025 (2025 Update). Precautionary balances comprise the Fund’s general and special reserves. They are a key element of the IMF’s multi-layered framework for managing financial risks. Precautionary balances provide a buffer to protect the Fund against potential losses, resulting from credit, income, and other financial risks. In conducting the review, the Executive Board applied the rules-based framework agreed in 2010 and reaffirmed in 2024. Precautionary balances have continued to increase since reaching the SDR 25 billion medium-term target at the end of FY2024. The overall balance of risks and risk mitigants to the Fund remain broadly unchanged since the 2025 Update. Precautionary balances are expected to remain above the target, including assuming additional distributions to the Interim Placement Administered Account (IPAA) in coming years. Against this background, Executive Directors endorsed staff’s proposal to retain the current medium-term target of SDR 25 billion and the minimum floor of SDR 20 billion.