INTERNATIONAL FEDERATION OF RED CROSS AND RED CRESCENT SOCIETIES, GENEVA
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Page 51
Public
4.6 Financial instruments
– Fair values and risk management (continued)
Interest rate risk
There is no significant short-term exposure to changes in interest rates, as cash and cash equivalents are held as cash in hand,
on-demand deposits, or in short-term deposits with original maturities of three months or less, and there are no interest-
bearing liabilities. Short-term investments with maturities of more than three months and long-term investments have fixed
interest rates for the terms of the investments.
The IFRC maintains the majority of its deposits in Swiss francs. In January 2015, the Swiss National Bank (SNB) introduced
a negative interest rate on certain Swiss franc deposits. In July 2022, this negative interest rate policy was relaxed and certain
Swiss banks with which the IFRC holds funds started paying positive interest on deposits. Some other non-Swiss banks, with
which the IFRC holds funds for operational purposes, stopped charging negative interest in 2023. The IFRC has avoided
significant exposure to negative interest during the negative interest rate period.
(ii) Credit risk
Credit risk arises primarily from holding receivables that may not be settled and from holding cash balances with financial
institutions that may default.
The IFRC’s principal receivables are with member National Societies, donor governments, and other international
organisations where credit risk is considered to be low. A breakdown is provided below:
Receivables credit exposure
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