The 101 CBI/PwC Financial Services survey shows strong business growth across most industry sectors, but a mixed outlook for the year to come.
For a second successive quarter, business volumes rose at a robust pace driven by growing domestic demand from private individuals and corporates. Firms across all sectors expect volumes to expand next quarter, but confidence in the general business situation was more varied, with insurers becoming increasingly pessimistic.
With the exception of banks, most financial services firms have allowed their costs to rise but not to the detriment of financial performance. Profitability has improved as well across all sectors apart from life insurance. Profit growth is forecast to remain strong in Q1 of 2015 for all but insurers and building societies.
There have also been variations in the numbers employed, with banking and general insurance reporting a significant decrease in headcount in contrast to the other sectors. Despite this, overall training expenditure rose, highlighting a skill shortage on the financial services labour market.
The CBI/PwC Financial Services Survey is a quarterly trends report that discusses the health, perceptions and plans of the UK financial services industry.