Debt Management Analysis

in CS-DRMS
Arindam Roy,
Debt Management Section, Commonwealth Secretariat

Asian Regional Public Debt Management Forum:

ADB & Bank Negara, Malaysia
Kuala Lumpur, 3-5 November 2009
 Outline

• Analytical Features in CS-DRMS

• Public Debt Analytical Tool
Analytical Features in CS-DRMS
CS-DRMS: Debt Management Tool
• Commonwealth Secretariat’s Debt
Management Program – Flagship Program
• CS-DRMS in the wake of the 1982 debt crises
• CS-DRMS now used in 59 countries globally
• 45 member countries – free assistance
• 14 non-members (Crown Agents and OIF)
• 17 countries in Asia - Pacific
• Evolving Debt Program:
• CS-DRMS: Recording to Management System
• Increasing Focus on Advisory & Debt Analysis
Static Analysis – New Reports
Purpose Coverage Indicators
Public Debt Portfolio •Residency •External vs Domestic

•Currency •Currency Mix

•Interest Rate Type •Fixed vs Floating

•Maturity •Original vs Residual

•Instrument Type •T Bills / Bonds / Zeros /

Indexed / Loans/ Indexed
Domestic Debt Market •Cost of Borrowings •Min / Max / Avg. Yields
Development •Re-openings •Stock of Re-openings
Static Analysis – New Reports
Purpose Coverage Indicators
Risk Indicators •Refinancing Risk •% of debt maturing
within one year
•Average time to
maturity

•Rollover Risk •Re-fixing within 1 year

•Currency Risk •Local vs Fx Currency

•Interest Rate Risk •Fixed-Floating Mix

•Duration
•Average time to re-
fixing
Static Analysis – Snap Shot of Reports
Static Analysis – New Reports
• Aid thinking on
• Debt Strategy for future borrowing
• Domestic Debt Market Development
• Cash Flow Management
• Borrowing program
• Debt Restructuring
• Develop Public Debt Bulletin
Auctioning of Securities through CS-SAS
Interface with other Analytical Tools –
Data Export Bridge in CS-DRMS
• MTDS Framework of
IMF-World Bank
• DSA-DSF Framework
of IMF-World Bank
• Other third party
tools: Debt Pro
Dynamic Analysis through Management
Tools in CS-DRMS
• Scenario and Sensitivity Analysis
• Build Scenarios
• New Borrowings (alternative debt strategies)
• Sensitivity Analysis: Market Rate and Macro
economic assumptions (forecasts)
• Assess impact on debt portfolio
• Debt stock, Debt service and Debt ratios
• Evaluation of New Loans
• Assess Debt Restructuring Options
• Identify high cost debt for restructuring
Portfolio Review in MT: Snapshot
Portfolio Review: Snapshot
Portfolio Review in MT: Loan Ranking
Evaluate New Borrowing in MT
• Calculate PV and Grant Element.
Future Impact on Cash Flows and Debt Stock
Debt Service - With and Without Future Disbursements

40000
ENR (Thousand)

30000

20000

10000

0
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Year

PRP-DI INT-DI PRP INT

DOD and PV - Without Future Disbursements

500000
ENR (Thousand)

400000
300000
200000
100000
0
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Year

DOD PV
Sensitivity Analysis in MT: Impact
Impact of Exchange Rate Variation on Debt-GDP Ratio

0.8

0.7

0.6

0.5

0.4

0.3

0.2

0.1

0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Var-2-1 Var-2-2 Var-3-1 Var-3-2 CV

Public Debt Analytical Tool
Why PDAT?
• PDAT builds upon MTDS framework
• framework and functionalities of MTDS
• PDAT to serve beyond MTDS
• Implementation of Debt Strategy
• Development and Implementation of Annual
Borrowing Plan
• Auctioning calendar and market development
• Support Liability Management Operations
• Monitoring of MTDS
• Stand alone tool
Framework of PDAT
Plans for PDAT
• Analytical Framework being finalized
• Based on best practices
• To be shared for review and peer comments
• Outsource development
• Plans to roll out PDAT by end 2010
 Thank You

please log into www.csdrms.org

for further information