You are here
Growth back on the agenda for UK financial firms: industry survey
[LONDON] Growth is back on the agenda for Britain's financial services companies, which have been posting rising profits and adding staff in recent months, an industry survey showed on Monday.
Following the 2007-09 financial crisis, many of Britain's banks and financial services firms were forced to trim costs and cut jobs and cope with a raft of new regulations.
According to the latest quarterly review of the industry by the Confederation of British Industry (CBI) and consultancy PwC, firms may be starting to move on from the painful period of restructuring.
Business volumes grew at their fastest rate since 2007 in the quarter to September, while 60 per cent of firms reported greater profits, the survey of 109 companies found.
That trend is expected to continue in the current quarter, with the majority of firms forecasting another period of rising volumes and profits.
Respondents said competition was among their main concerns for the coming year, which suggested companies were looking for opportunities to grow. "The sector could be moving to a new phase in the recovery where firms are feeling more assured about the level of demand and are now shifting their gaze to competing for new customers and business," Rain Newton-Smith, CBI's director for economics, said in a statement that accompanied the report.
Separate research from recruitment firm Astbury Marsden said financial sector firms in London, home to around a third of the industry's workers, created 3,470 new jobs in September, 46 per cent more than the same period last year.
Many of the new roles were in compliance and regulatory functions, and stronger equity markets have created a need for more dealmakers and front office staff.
"We are now also starting to see many employers feel that the time is right to drive business growth by building up their revenue earning teams," said Adam Jackson, a director at Astbury Marsden.
"As the IPO (initial public offering) and M&A (mergers and acquisitions) markets heat up, this will have a positive knock-on effect on hiring in equities trading, broking and corporate finance departments," he added.
M&A volumes rose by more 60 per cent to US$2.7 trillion in the first nine months of the year, while equity capital market deals were up by a quarter at US$678.1 billion, Thomson Reuters data showed last week. That spike in activity sent investment banking fees up by 13 per cent to US$68.8 billion in the year to end-September.
Astbury Marsden said firms were also hiring in technology in response to regulatory demands for improvements to data protection systems.
Large investment banks want staff to help identify and counter threats to the integrity of their IT infrastructure, the recruiter added. "The cyber security jobs market has grown rapidly in recent months, and the banks are actively recruiting information security specialists to shore up their technology teams," Mr Jackson said. - Reuters