CBI Confederation of British Industry : New Financial Services Survey

The latest CBI/PwC Financial Services Survey shows only a marginal improvement in sentiment within the sector in the quarter to December 2015, for the second quarter in a row, and in contrast to the more robust increases seen during the first half of 2015. Strong competition is bearing down on incomes, though tight cost control is helping to support growth in profitability.

Click here to read the CBI/PWC Financial Services Survey

While firms are less bullish than a year ago, conditions within the sector remain generally favourable. Companies reported a solid increase in business volumes, with growth picking up from the previous quarter and outpacing expectations. The recovery was evident across all customer groups and was also broad-based across sectors. One notable exception was banking, where volumes were largely stable for the fourth quarter in a row.

Elsewhere, employment prospects remain mixed, with banks reporting falling employment, compared with solid growth in headcount in the insurance and building society sectors. Overall, expenditure on training rose strongly in the three months to December.

While investment intentions remain robust in IT, and marketing spend is set to expand as firms seek new customers, elsewhere companies are curtailing their capital spending due to poor returns.

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