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Top 10 Companies With More Cash Than The U.S. Government

Posted
8/2/2011 6:55:00 PM
By: Kapitall
Referenced Stocks:BAC;BBVA;BCS;CS;GE;HBC;LYG;RBS;STD;UBS

(List compiled by Andrew Dominguez. Data sourced from Screener.co. Disclosure: Andrew Dominguez owns GE shares.)

In some senses, paying taxes is like buying shares of a company – taxes are an investment in the wellbeing of a country and its citizens. It can also provide a sense of ownership and involvement in the state of the government and society.

By the same token, one would hope that the government is trying to maximize value for its shareholders – its tax-paying and tax-exempt citizenry. This might include constantly improving roads, fire and police departments, education, pensions, and a whole host of other services. This is why the recent debt ceiling debacle has been particularly frustrating for this author. 

The decision to cut budgets without raising taxes seems to imply that our elected officials would rather bail on its obligations to their most vulnerable constituents – those that rely on public education and transportation for their livelihoods; the retired; the poor and huddled masses – instead of asking the most fortunate members of the populace to lend a helping hand.

Arguing that low marginal tax rates are essential to spur growth overlook the fact that the remarkable growth in the 1960s, still considered a benchmark for potential GDP, occurred in spite of a 91 percent income tax on the highest earners. 

By pandering to the strongest members of society and abandoning the weakest, the American government may have squandered the American dream – the idea that meritocracy and liberalism could afford social and economic mobility to all of America’s citizens; a belief in a city upon a hill, shining like a beacon for the rest of the world to behold in wonder, like Lady Liberty herself.

Instead, the government is near broke. According to the Treasury department, the total amount of taxpayers’ money left in the coffers amounts to little more than $67bn, around half of what was available as recently as mid-July.

A number of companies have handled their shareholders’ money much more responsibly than the American government. Here is a list of the ten companies that have more cash at their disposal than Uncle Sam does. 

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List sorted by cash and equivalents in the most recent quarter.

Note: Because many of the companies listed below are foreign/ADR stocks, there could be a mismatch between market cap and cash & equivalents figures. Cash & equivalents reflect all of the cash held by the company, globally. Market cap might only reflect the total value of shares listed in American exchanges, which would not include the value of shares listed in other countries.

1. Banco Bilbao Vizcaya Argentaria SA (BBVA): Money Center Banks industry with a market cap of $47.96B. Cash and Equivalents at $512.07B. It is a diversified international financial group, with strengths in the traditional banking businesses of retail banking, asset management, private banking and wholesale banking. It also has investments in some of Spain’s companies. During the year ended December 31, 2009, BBVA focused its operations on six major business areas: Spain and Portugal, Wholesale Banking and Asset Management, Mexico, The United States, South America and Corporate Activities.

2. UBS AG (UBS): Investment Services industry with a market cap of $62.41B. Cash and Equivalents at $165.15B. It offers a combination of wealth management, asset management and investment banking services on a global and regional basis. As of December 31, 2009, it operated about 973 business and banking locations worldwide, of which about 42% were in Switzerland, 41% in the Americas, 12% in the rest of Europe, Middle East and Africa, and 5% in Asia-Pacific.

3. Barclays PLC (BCS): Money Center Banks industry with a market cap of $43.75B. Cash and Equivalents at $160.26B. It is engaged in retail banking, credit cards, corporate and investment banking and wealth management. It operates through branches, offices and subsidiaries in the United Kingdom and overseas.

4. General Electric Company (GE): Conglomerates industry with a market cap of $190.49B. Cash and Equivalents at $136.4B. It is a diversified technology and financial services corporation. Its products and services range from aircraft engines, power generation, water processing, and household appliances to medical imaging, business and consumer financing and industrial products. Its segments include Energy Infrastructure, Technology Infrastructure, NBC Universal, GE Capital and Home & Business Solutions.

5. Banco Santander, S.A. (STD): Regional Banks industry with a market cap of $85.06B. Cash and Equivalents at $123.59B. It operates principally in Spain, the United Kingdom, Portugal, other European countries, Brazil and other Latin American countries and the United States, offering a range of financial products. It operates in four segments: Continental Europe, United Kingdom, Latin America and Sovereign.

6. Bank of America Corporation (BAC): Money Center Banks industry with a market cap of $99.59B. Cash and Equivalents at $119.53B. It serves individual consumers, small and middle market businesses, corporations and governments with a range of banking, investing, asset management and other financial and risk management products and services. It provides a range of banking and non-banking financial services and products through six business segments: Deposits, Global Card Services, Home Loans & Insurance, Global Commercial Banking, Global Banking & Markets (GBAM) and Global Wealth & Investment Management (GWIM), with the remaining operations recorded in All Other.

7. Royal Bank of Scotland Group PLC (RBS): Money Center Banks industry with a market cap of $33.45B. Cash and Equivalents at $97.82B. It operates in the United Kingdom, the United States, and internationally through its two principal subsidiaries, The Royal Bank of Scotland plc and National Westminster Bank Plc. Its business segments include: UK Retail, UK Corporate, Wealth, Global Banking and Markets (GBM), Global Transaction Services, Ulster Bank, US Retail and Commercial and RBS Insurance.

8. Lloyds TSB Group PLC (LYG): Money Center Banks industry with a market cap of $47.25B. Cash and Equivalents at $88.94B. It provides a range of banking and financial services, primarily in the United Kingdom, to personal and corporate customers. Its main business activities are retail, commercial and corporate banking, general insurance, and life, pensions and investment provision. It also operates an international banking business with a global footprint in over 30 countries.

9. Credit Suisse Group AG (CS): Investment Services industry with a market cap of $42.34B. Cash and Equivalents at $87.16B. It provides advisory services, solutions and products to companies, institutional clients and private clients globally, as well as to the retail clients in Switzerland. It operates in three business segments: Private Banking, Investment Banking and Asset Management.

10. HSBC Holdings PLC (HBC): Regional Banks industry with a market cap of $177.94B. Cash and Equivalents at $71.75B. It is a global banking and financial services organizations. As of December 31, 2010, it provided a range of financial services to around 95 million customers through two customer groups, Personal Financial Services (PFS), including consumer finance, and Commercial Banking (CMB), and two global businesses, Global Banking and Markets (GB&M), and Global Private Banking (GPB). As of December 31, 2010, the Company had an international network of some 7,500 offices in 87 countries and territories in six geographical regions; Europe, Hong Kong, Rest of Asia-Pacific, the Middle East, North America and Latin America.