Following a similar survey conducted in 2011, this latest study identifies trends and developments over the last twelve months, such as an increased surplus of cash and a greater proportion of cash invested in money market funds (MMFs) by some companies as compared to 2011 survey results. In addition, an intensified focus on market issues, such as the Eurozone crisis, regulatory changes and counterparty risk, are rising to the top of treasurers’ list of priorities compared to the previous year.

Responses were collected from more than 200 corporations globally across a wide range of industries, and about 20 percent representing financial institutions. More than 50 percent of respondents were from companies headquartered in North America, 32 percent in Europe, and the rest in the Asia Pacific region. More than 70 percent of participating companies had annual revenues exceeding $1 billion. Key findings of the report include the following:
- Some companies are growing their cash reserves, with 37 percent of companies increasing the amount of surplus cash over the past twelve months
- Some companies are increasing their shares of cash investments in MMFs. Those using short-term MMFs hold an average of 50 percent of their cash in these funds -- representing an increase of more than 11 percent from 2011
- Although only 9 percent of companies surveyed invest in MMFs that have a variable net asset value (NAV), these companies hold an average of 36 percent of their cash in these instruments, compared to only 4.5 percent in 2011 -- reflecting a change to an investment strategy more in line with regulatory preference for variable funds
- Forty-three percent of respondents said they use an online trading portal for cash investments -- an increase of 6 percent over 2011

Vince Tolve, vice president of SunGard’s brokerage business, said, “Although concerns regarding credit risk and liquidity remain important factors, regulation in the US and Europe has emerged strongly as a concern as lawmakers focus on enhancing the resilience of funds to extreme market shocks. An immediate issue, however, is the expiration of FDIC* guaranteed non-interest bearing accounts at the end of this year. Many companies that have used insured bank deposits will need to find alternative repositories for cash. The growing use of online trading portals will provide potential for enhanced visibility, auditability, analytics and operational efficiency as corporate treasurers embark on making new investment decisions.”

The SGN Short-Term Cash Management portal is a global, multi-fund trading platform that helps corporate treasurers increase efficiency in researching, analyzing and gathering relevant information to help optimize short-term investment strategies.

* Federal Deposit Insurance Corporation

About the SunGard Global Network (SGN)
The SunGard Global Network (SGN) is a trading services network that links asset managers and brokers throughout the financial services value chain, offering trade automation and connectivity for equities, fixed income, listed derivatives, mutual funds, money market funds and other cash equivalents. SGN helps automate the entire trade lifecycle, from order execution through to post-trade processing. It facilitates trading around the world, connects with major third-party order-routing networks, and delivers low-latency global market data. For more information, please visit www.sungard.com/sgn.

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