A recent survey disclosed that the financial sector had refused to throw in the towel to the continuing economic gloom in the country, and is standing quite firm.
According to a study by the Confederation of British Industry (CBI) and PricewaterhouseCoopers (PwC), the financial service industry was prospering and could affect significant increases in recruitments, promotional activities or investments in IT and commercial property in the near future.
Nevertheless, a growth in the number of firms posting increased bad debts posed a serious question on whether the industry would be able to survive these strenuous times for long.
The survey, meanwhile, saw fund managers and traders in securities recording strong performances in the quarter, with robust increases in sales and profits. Moreover, employment in the sector also rose up along with company income, which is predicted to follow the same trend in the coming quarter as well.
The British financial industry is the world’s largest exporter of financial services and therefore domestic depressions do not affect its actual growth. Also, the net number of companies that were anticipating a rise in business volumes also scaled to 24 in September, against a meager 6 in June. Yet, the percentage of companies positive about the future and the entire business scenario plummeted, clearly indicating the impact of the downturn on other sectors of the economy.
Banks, being amongst them, projected one of the weakest reactions received in two years, as they had rather pessimistic predictions for the future, fearing effects of the crude oil hike on borrowing trends of both consumers as well as businesses.
However, UK banking leader at PwC, John Hitchins, dismissed the view and said, “The fall in optimism is perhaps slightly surprising when you see that they are experiencing reasonable growth rates. I think it reflects a nervousness about possible shocks to the economy in the short term rather than any fundamental concern about the underlying business.”
What’s more, net 29% of financial companies have plans to increase employment, while net 34% intend to spend more on training personnel with net 41% companies to hike budgets for promotions and net 35% looking to invest in corporate property. In addition, a net 44% rise was noticed in companies proposing to make investments in information technology.
Posted
on : Mon, 03 Oct 2005 19:40 GMT | Banking News
By : Pippa Fielding
|
