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AFP Press Release

Corporate Treasurers Report Higher Cash Balances in First Quarter

AFP Corporate Cash Indicators™ show companies choosing marginally more aggressive short-term investments


WASHINGTON – April 23, 2012– Companies increased their cash and short-term investment balances in the first quarter, according to the AFP Corporate Cash Indicators™ (AFP CCI), a quarterly study that measures recent and anticipated changes in U.S. corporate cash balances. Quarter-to-quarter, 40 percent of reporting organizations had greater cash balances at the end of 1Q12 than they had at the end of 4Q11.

Meanwhile, companies reported that their investment selection for cash and short-term investments had become marginally more aggressive, with a net 3 percent of respondents indicating a more aggressive investment selection.

Year-over-year, cash hoarding increased, with 40 percent holding larger balances at the end of 1Q12 than they had at the end of the 1Q11.

Looking ahead, 32 percent expect to add to cash and short-term investment balances during 2Q12 compared to 24 percent that expect to reduce balances.

AFP Corporate Cash Indicators™
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+13 1Q12 v. 4Q11
+13 1Q12 v. 1Q11
+08 Expectations for 2Q12

Represents “increase” percentage minus “decrease” percentage.

The AFP CCI™ provides treasury and finance professionals, policymakers and market analysts with timely data on a determinant of economic activity: corporate cash. The AFP CCI™ is created and maintained by the Association for Financial Professionals (AFP), a professional society that serves corporate finance departments globally.

Methodology: On the opening days of each quarter, AFP asks select members whether their short-term holdings increased or decreased in the past year and past quarter; whether investment selections for those holdings changed in the last quarter; and whether they expect cash holdings to increase or decrease in the coming quarter. For consistency, AFP asks the same questions each quarter. AFP members have agreed to participate in this ongoing study on a long-term basis.

AFP began collecting quarterly data in January 2011 and has now collected five data sets. The next set will be published in the July 23, 2012 issue of AFP EconWatch newsletter (www.AFPonline.org/econwatch).

AFP Corporate Cash Indicators™ is a trademark of the Association for Financial Professionals. All AFP Corporate Cash Indicators™ survey questions and reports are the copyrights of the Association for Financial Professionals, and all rights are reserved. For more information and to learn about publishing the CCI on your site, see www.afponline.org/CCI or contact pr@afponline.org.

ABOUT AFP®
The Association for Financial Professionals (AFP) is the daily resource for a network of more than 16,000 treasury and finance professionals. Headquartered outside Washington, DC, AFP provides members with news, economic research and data, treasury certification programs, networking events, financial analytical tools, training, and public policy representation to legislators and regulators. AFP's global reach extends to over 150,000 treasury and financial professionals worldwide, including AFP of Canada; London-based gtnews, an on-line resource for the treasury and finance community; and bobsguide, a financial IT solutions network.

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