57% of Singapore’s publicly listed firms have sufficient cash to repay short-term debt: MAS

Over half of Singapore Exchange-listed firms (57%) have sufficient cash buffers to repay their short-term debt until the end of 2021, even without refinancing, according to simulations run by the Monetary Authority of Singapore (MAS).

Even if the parameters of the simulation were adjusted to a more adverse scenario, 54% of publicly-listed firms would have resilient cash buffers until the end of next year, it said.

Analysis of financial data from about 65,000 firms also revealed that the proportion of SMEs that are vulnerable is about 30 percentage points higher than larger firms. 

Firms with more vulnerable buffers tend to be small in size, with lower annual revenues of less than S$100 million (US$74.92 million), it said. 

A higher proportion of firms in the accommodation, food and beverage, construction and retail sectors were also found to be in weaker cash positions, and facing higher liquidity stresses. 

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“While the economy is expected to pick up next year, its uneven trajectory will impinge on corporate profits,” MAS said in its annual financial stability review. 

“Pockets of risks remain for smaller firms which tend to be financially weaker, and those in the domestically-oriented and travel-related services impacted by COVID-19,” it added.