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Two decades of investing in reserve managers: World Bank Treasury’s RAMP

Two decades of investing in reserve managers: World Bank Treasury’s RAMP

Developed within the World Bank Treasury, the Reserve Advisory & Management Partnership (RAMP) builds human capital, delivers asset management services and convenes a network of practitioners – in a single programme. Established in the early 2000s, it serves more than 70 members, including central banks.

In October 2001, a European central bank became the first member of the World Bank Treasury’s RAMP, which has since grown to nearly 80 members, including almost 60 central banks and other public sector institutions, and $26 billion of assets under management (AUM). The partnership began following a request by central banks to support their reserve management with World Bank expertise and resources.

As RAMP celebrates its 20th anniversary in 2021, global international reserves have grown from $2 trillion to $14 trillion in the same period. Reserves are an essential buffer to protect against economic shocks, and managing them prudently and efficiently promotes economic stability and growth. Periods of economic and financial turmoil, such as the Covid-19 pandemic, highlight the importance of sound reserve management practices. To this end, the partnership supports public sector reserve managers worldwide by delivering technical advisory and asset management services, training staff and fostering a network of practitioners.

Delivering advisory and asset management services

The World Bank Treasury has more than seven decades of experience successfully managing high-grade fixed-income portfolios while controlling downside risks in a disciplined fashion. RAMP’s peer-to-peer model gives members access to experts dedicated to enhancing asset management practices across public sector institutions. The partnership shares the asset management expertise of World Bank staff and RAMP members across governance, investment management, risk management, strategic asset allocation, legal, operations and IT. Additionally, RAMP provides members with proprietary in-house software. For example, the Asset Management Workbench develops and stress-tests the strategic asset allocation, and the Benchmarking Analysis Tool compares reserve management practices across central banks.

Serving as a trusted adviser on a non-commercial model

Members gain access to a trusted adviser to collaborate, solve problems and provide perspectives on global best practices to boards, committees and staff. RAMP operates on a non-commercial basis. This unique business model allows RAMP to serve as a strategic partner invested in its members’ interests, and RAMP assists its members at all levels. The model supports a long-term training plan for members’ staff, and the broad global reach of the partnership has a multiplier effect on shared knowledge between members. Some of RAMP’s first members remain in the partnership today because they value the ongoing transfer of knowledge and skills from RAMP and fellow members.

Providing training services and a robust annual workshop programme

RAMP also leverages expertise in all areas of reserve management through a suite of training products, such as technical workshops and thought leadership webinars on a broad range of trends and themes –each with direct relevance to members. World Bank experts train RAMP member staff in hands-on week-long workshops, offering case studies to ensure concepts are immediately applied to real-life situations. As part of its series of conferences and workshops, RAMP annually offers more than 30 events in all the areas of asset management, supplemented by a robust programme of third-party finance certifications and specialised courses that focus on refining skill sets and expertise in the financial industry.

RAMP members similarly have access to a premier digital learning solution with interactive and comprehensive content on financial markets, and coherent knowledge analytics to support users in the process. Additionally, at the height of the pandemic, the partnership expanded and evolved its services to meet heightened demand in a fully virtual world. RAMP now delivers all services remotely and hosts distinguished speakers, global market updates and technical webinars every month, and the partnership plans to return to in-person events as soon as this can be done safely.

Networking a global and diverse membership

Through World Bank expertise, RAMP is uniquely positioned to support public asset management institutions. RAMP members come from all regions, and some of the most sophisticated public asset management institutions impart their expertise with the partnership. AUM have steadily grown for two decades, and RAMP members collectively manage more than $2 trillion of assets. Although two-thirds of RAMP members are located in middle- and high-income countries, one in 10 RAMP members are in fragile and conflict-affected situations. With the support of generous donors, RAMP recently launched the RAMP Trust Fund to subsidise membership for some of the world’s most vulnerable institutions.

Providing thought leadership for central bank executives

As part of the partnership’s ongoing commitment to stimulate open discussion on issues affecting the public asset management community, RAMP hosts high-level events to foster thought leadership and share experiences, lessons learned and views on the future of investment management practices.

RAMP staff also provide knowledge products in all areas of asset management to support members. For example, RAMP undertakes detailed surveys on reserve management practices of central banks every two years. In November 2021, RAMP published the findings of the latest survey of central bank reserve management practices, which attracted 119 respondents. Survey results allow central banks to benchmark their practices against their peers and identify the areas in which they can improve.

RAMP’s offering constantly evolves in response to emerging trends. For instance, RAMP published a first-ever environmental, social and governance (ESG) primer for central bank reserve managers in October 2021. Treasury experts outlined the opportunities and challenges of incorporating ESG into public sector institution portfolios, including five approaches reserve managers can take to implement an ESG strategy.

More than just a partnership

RAMP’s 20th anniversary is a momentous milestone for the partnership and reserve managers worldwide. RAMP has been a global one-of-a-kind network where members can interact, share and develop new ideas with world-renowned academics and practitioners. To mark this year’s milestone, the partnership recognises perspectives that make up the fabric of RAMP through one-on-one discussions published in the RAMP Voices series. As countries gradually enter the new normal, the World Bank Treasury and RAMP will stand with reserve managers for the years to come.

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