Ottawa, October 21, 2009

Archived - Minister of Finance Releases 2008–09 Report on the Management of Canada's Official International Reserves

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The Honourable Jim Flaherty, Minister of Finance, today released the Report on the Management of Canada's Official International Reserves for April 1, 2008 to March 31, 2009.

This annual report provides details on official international reserves operations, primarily related to the Exchange Fund Account (EFA), which is a portfolio of assets held under the Currency Act to provide foreign currency liquidity to the Government and to promote orderly conditions for the Canadian dollar in the foreign exchange markets, if required.

The report notes:

  • The market value of the official international reserves increased to US$43.5 billion as of March 31, 2009 from US$43.1 billion as of March 31, 2008.
  • The objectives of the EFA were fully met during the 2008–09 reporting period, as the capital value of the liquid reserve assets held in the EFA was maintained in a cost-effective manner. Credit risk stemming from disruptions in capital markets was prudently managed and the EFA did not realize any credit losses.
  • In 2008–09, the foreign currency assets held in the EFA earned an average positive spread of 31 basis points over the coupons on foreign liabilities used to fund the assets. The return was up from 22 basis points in the previous year. Taking into account changes in the market value of assets and liabilities due to interest rate changes, credit spreads and coupon flows, the EFA reported an unrealized mark-to-market or total return of US$446 million. This compares to a mark-to-market loss of $394 million in the previous year.
  • During 2008–09, the EFA's Statement of Investment Policy was reviewed and modified to include a broader list of eligible investments. Debt issued by sub-sovereign entities, most rated AAA, and government-guaranteed securities issued by private sector financial institutions were added to the list of eligible investments.

The report can be viewed on the Department of Finance website at

For further information, media may contact:

Chisholm Pothier
Press Secretary
Office of the Minister of Finance

Jack Aubry
Media Relations
Department of Finance

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