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Financial firms remain optimistic, say business groups

Thursday, April 16th, 2015

The Confederation of British Industry (CBI) and PwC have released figures from their latest survey of financial services firms in the UK.

Director of Economics at the CBI, Rain Newton-Smith, said: “This quarter was a mixed picture for the financial services sector. Firms remained upbeat as profits held up, despite weak growth in business volumes in some sectors, especially banking.”

But he warned: “The overall headcount in financial services fell for a second consecutive quarter, driven by banks cutting staff as they make their business operations leaner, refocusing activities as a result of new capital rules and regulatory requirements.”

According to the survey, 59% of financial services firms reported they were more optimistic than three months ago, while only 9% said the opposite. This positive outlook hasn’t been seen in the sector since December 2013.

46% of firms reported that their headcounts had fallen, with 23% showing increased employment.

Kevin Burrows, financial services leader at PwC, said: “Looking at the UK’s regulatory environment, banks are most concerned about cost and proportionality. Even so, the sector currently has a good grip on its regulatory agenda, and regulation is seen as less of an obstacle to growth than at any point last year.”

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