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The Financial Wealth of Corporations: A First Look at Sectoral Balance Sheet Data
Author:
Ms. Yuko Hashimoto
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and
Mr. Noriaki Kinoshita
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Series:
IMF Working Papers
Volume/Issue:
Volume 2016: Issue 011
Language:
English
Publication Date:
26 Jan 2016
DOI:
https://doi.org/10.5089/9781484395073.001
ISBN:
9781484395073
ISSN:
1018-5941
Pages:
29
Keywords:
WP; debt; economy; balance sheet adjustment; cash; balance sheet data; Nonfinancial corporation; financial balance sheet; net financial wealth; NFC sector; balance sheet condition; cash holding; financial asset accumulation; Financial statements; Currencies; Stocks; Global financial crisis of 2008-2009; Business enterprises; Global
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IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper analyzes the nonfinancial corporation (NFC) sector’s financial balance sheets using data available from the OECD. In our sample of 20 advanced economies, corporate debt in percent of GDP—a frequently used indicator in the context of corporate balance sheet adjustments—has remained high since the global financial crisis, with significant differences in the level and the trend between the high-debt and low-debt groups. Looking at financial balance sheets more broadly, including net financial wealth, the NFC sector’s balance sheet conditions have improved recently, particularly reflecting accumulation of corporate cash and valuation gains on financial assets. Longer time series and more granular data for Japan, which has been experiencing a prolonged period of balance sheet adjustments, indicate that a continued strengthening of balance sheets might occur even after debt levels are reduced.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund
Volume 2016: Issue 011