If Apple Inc. were a bond fund, it would dwarf thecompetition.

The iPhone-maker has $148 billion of its record $257billion cash pile invested in corporate debt alone, accordingto a company filing from Wednesday. That's enough to buy all theassets in the world's largest fixed-income mutual fund, theVanguard Total Bond Market Index Fund, which has about $145 billionof assets including company, government and mortgagebonds.

Like many technology companies, Apple has resistedtransferring the money it earns abroad back to the U.S. to avoidtriggering corporate income taxes on the earnings. Instead, thecompany invests in corporate bonds and other assets like moneymarket funds and U.S. Treasuries.

With more than 90% of its war chest abroad, the companyregularly issues bonds of its own to help fund programs like sharebuybacks and capital spending. Apple said Thursday it's sellingdebt in as many as six parts to support a 63-cent dividend and anincreased stock-repurchase program.

Apple and other cash-rich companies are holding out, hoping thatthey may soon be able to bring their cash home at a lower tax rate.President Donald Trump's tax plan includes a repatriationprovision, though it didn't specify a rate. He proposed a 10% levywhen campaigning, and Treasury Secretary Steve Mnuchin hassaid the rate would be “very competitive.”

Apple's holdings, managed by its Braeburn Capital Inc. unit inReno, Nevada, may be large enough to move markets if the companymakes any big shifts in its allocations. Apple has typicallyfavored safer, shorter-dated bonds from high-rated financialissuers and other companies.

Preparing for repatriation may mean cash-rich companies want tohold more of their funds in more liquid securities like U.S.Treasuries, said Benjamin Campbell, CEO of Capital Advisors Group,which advises companies on cash and risk management.

“Companies have been looking at the repatriation issue and aportion of them are prepping for it,” Campbell said. “I thinkTreasuries would end up absorbing some of the supply.”

After corporate bonds, Apple's next-largest holdings in itspile of cash and marketable securities are $53 billion it allocatesto Treasuries and $21 billion it keeps in mortgage and asset-backedsecurities.

Apple executives have been mum on what they'd do if repatriationbecomes a reality.

“It's very difficult for us to speculate,” Apple CFO LucaMaestri said in an interview Tuesday. “We'd like to reassess whatwe've done if and when that happens.”

Bloomberg News

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