COMPANIES, LITTLE-KNOWN INVESTMENTS

Daily Media | June 2021

492 billion euros: it is the amount of liquidity on the bank accounts of Italian companies in February 2021 (source: Banca d’Italia).

It is an impressive figure, even more so if we consider that the increase in the amount of companies’ liquidity over the last year is worth 94 billion euros.

In 2021, families with 1.122 billion euros in liquidity saw an increase in the amount of liquidity of “only” 72 billion euros.

We talk about Italians and Italian families. In truth, the issue of liquidity on bank accounts is much more worrying when it comes to Italian companies.

On the one hand, entire sectors are in a situation of great distress; on the other hand, there are companies who own an overall amount of liquidity sufficient to kick-start the economy.

There are two reasons why companies keep liquidity on bank accounts.

The first reason is a general prudential attitude: 89% of entrepreneurs claim to keep liquidity “in case of need”.

Few entrepreneurs take into account the effects of the loss of value of money from inflation and the cost of raw materials.

The second reason is connected to banks’ insufficient proactivity.

In fact, only 34% of entrepreneurs with an amount of liquidity worth over 2 hundred thousand euros on their companies’ bank accounts have been contacted by their manager for an investment proposal over the last 12 months.

In other words, three quarters (76%) of Italian entrepreneurs have not been contacted by their manager and left to themselves and their assumptions.

One of their worst assumptions is that savings are an insurance in case of need.

In truth, insurance policies are completely unknown to entrepreneurs and Italian small and medium companies: less than 5% of them have an insurance on key people which would make up financially for any accident that might cause problems to the company.

Streams of words are spent every day on the Italians’ inadequate financial culture, while only a few lines are dedicated to the very lacking ability of the offer to become bearer of investment and protection culture.

We discuss products, service models, scheduling, planning, but we talk very little about people (clients and professionals), who are at the heart of everything.

It is necessary for supply and demand to be considered as the yin and yang, whose roots are interrelated, interdependent; in other words, one cannot exist without the other.

It is necessary to segment clients depending on their attitude towards the issues of protection and investments, of supply and the business proposal style of the financial professional (insurance agent or bank employee).

Perhaps a mature client needs a good agent, while a fearful or lazy client needs a dynamic professional; but the contrary might also be true. The issue needs to be explored further.

In any case, when it comes to markets guided by offer, the offer must first of all reawaken millions of Italians from a dangerous lethargy.

Nicola Ronchetti