Update at a Glance
July 9, 2009
AFP Liquidity Survey Results Highlight Shifting Industry Trends
The Association for Financial Professionals (AFP) has just released its 2009 Liquidity Survey. Underwritten by The Bank of New York Mellon, this year's survey offers financial professionals insight into the current state of liquidity management, how organizations are managing their short-term investment portfolios, and the issues driving their decisions.
The survey results, compiled from 360 AFP member responses through the end of May 2009, include the following key findings:
- In reaction to slowing business conditions and volatility in financial markets, organizations have moved to a more conservative investment strategy over the past 12 months.
- Sixty-four percent of organizations with balances of non-U.S. cash and short-term investments indicate that they intend to maintain these balances at current levels over the next year.
- In May 2009, 42 percent of organizations held a larger U.S. cash and short-term investment balance than six months earlier.
- The use of several investment vehicles declined significantly over the past 12 months; including:
- Auction-rate securities (eight percent versus 18 percent in 2008).
- Asset-backed securities (20 percent versus 31 percent in 2008).
- Overall, organizations' investment policies allow for the use of an average of 4.1 short-term investment vehicles, in addition to bank deposits and Treasury bills. The average number of investment vehicles allowed by these policies in 2009 remains well below the 7.6 average reported in the 2006 survey.
Read the full survey, with a forward by Eric Kamback, The Bank of New York Mellon Treasury Services Chief Executive Officer, on our Web site.
For more information, call us at 1 800 424 3004 (Option 2) or e-mail us at treasury@bnymellon.com.