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The statistical classification of cash pooling activities

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  • Colangelo, Antonio

Abstract

Cash pooling is a bank service that allows corporates to externalise the intra-group cash management, and thus manage their global liquidity effectively with lower costs. Although there is little quantitative information on the significance of the phenomenon, cash pooling appears to have become increasingly popular after the onset of the financial crisis when, in an environment characterised by limited access to capital markets, reduced bank lending, low returns and higher risks on banks' deposits, corporate groups started to maximise their use of internal sources of financing. In particular, cash pooling is currently very relevant in Western and Northern European countries, and is mainly offered in the United Kingdom, France and the Netherlands. This paper first analyses cash pooling agreements with a focus on the aspects that are relevant from a statistical viewpoint. It then addresses their statistical recording in compliance with ESA 2010 and, specifically, the methodological framework of Monetary Financial Institutions (MFI) balance sheet item statistics. It is proposed that positions related to cash pooling shall be recorded on a gross basis vis- JEL Classification: G21, G32, E51, E43, M41

Suggested Citation

  • Colangelo, Antonio, 2016. "The statistical classification of cash pooling activities," Statistics Paper Series 16, European Central Bank.
    • Handle: RePEc:ecb:ecbsps:201616
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    File URL: https://www.ecb.europa.eu//pub/pdf/scpsps/ecbsp16.en.pdf
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    Citations

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    Cited by:

    1. Melle Bijlsma & Jan Kakes & Eric Klaaijsen, 2017. "Measuring cross-sectoral shifts in credit provisioning: an enhanced framework," IFC Bulletins chapters, in: Bank for International Settlements (ed.), Statistical implications of the new financial landscape, volume 43, Bank for International Settlements.
    2. Di Filippo, Gabriele, 2019. "Why is the Ratio of Debt-to-GDP so Large for Non-Financial Companies in Luxembourg?," MPRA Paper 105316, University Library of Munich, Germany.
    3. Ruben van der Helm & Jan Bartman, 2019. "Making available data more useable: compilation and publication of break-adjusted (historical) time series," IFC Bulletins chapters, in: Bank for International Settlements (ed.), Are post-crisis statistical initiatives completed?, volume 49, Bank for International Settlements.

    More about this item

    Keywords

    accounting standards; cash management; cash pooling; credit; MFI balance sheet statistics; monetary aggregates; statistical standards;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • E43 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Interest Rates: Determination, Term Structure, and Effects
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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