LONDON (MNI) – The pace of growth in the UK financial services
sector continued to slow in the three months to September, according
to the latest CBI/PwC Financial Services Survey, published Monday.
In the next three months, firms expect growth will be slower still
and, for the first time in two years, there will be no improvement in
profitability. Meanwhile, sentiment has fallen for the first time since
March 2009, as firms anticipate more challenging economic conditions.
Of the 84 financial services firms surveyed, 33% saw business
volumes rise in the quarter to September, and 24% reported a fall. The
resulting rounded balance of 10% is the lowest since June 2010 (a
balance of 9%) and represents a slower rate of growth than the June
quarter (17%).
Both the value of fee, commission and premium income (15%) and the
value of income from net interest, investment and trading (6%) grew,
although at a slightly slower rate than the previous quarter.
The rise in business volumes and income helped push up
profitability: 34% of firms reported a rise in profitability and 18% a
fall, giving a balance of +16%. That compared with +13% in June.
Other recent survey evidence points to relatively weak growth. The
September European Commission’s Economic Sentiment Indicator (ESI), for
example, recorded a sharp fall, with the UK seeing the third steepest
fall in sentiment among the largest member states,
The Bank of England’s Monetary Policy Committee, in the August
Inflation Report, had forecast a fairly rapid rebound in economic
activity in Q3 from the Royal Wedding and Japanese tsunami impacted Q2,
but there is mounting evidence Q3 growth may well disappoint.
–London newsroom 44207 862 7491; email: ukeditorial@marketnews.com
[TOPICS: M$B$$$,MABDS$]
