The Risks of Having Too Much Cash Jason Torgler, VP Strategy, Reval
Companies all around the world are awash with cash. According to the U.S. Federal Reserve, American corporations held a record $2.05tr in cash as of mid-2011. At the end of last year Bloomberg reported that European companies held almost $700bn in cash, which is 16% higher than at the end of 2007 when the financial crisis first emerged. At the same time, a report from UBS said that some European companies have cash on their books roughly equal to 5% or more of their total assets. Regardless of industry or region, corporations cannot be sanguine about these cash mountains; cash is an asset that needs to be rigorously tracked and risk managed.
Although the current amounts of cash present numerous opportunities for corporations, there are also significant issues to consider. Download this whitepaper to learn more about the often overlooked risks involved with excess cash.