Stubbornly low short-term interest rates have encouragedsome corporate treasurers to reach for more yield by moving tolonger-term investments or those with slightly lower creditquality. But the prevailing mode still seems to be caution,according to bankers and investment managers, with treasury teamsputting a premium on safety rather than yield.
To the extent that companies have invested farther out thecurve, they're likely to unwind those investments before short-termrates begin to rise.
The extent of the caution among corporate treasuries is evidentin the Association for Financial Professionals' 2013 Liquidity Survey, released in July, which showed 50% ofcompanies' cash is in bank deposits, up from 25% in 2008.
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Susan Kelly
Susan Kelly is a business journalist who has written for Treasury & Risk, FierceCFO, Global Finance, Financial Week, Bridge News and The Bond Buyer.
