UK
Financial firms’ IT outlay looks set to continue on a downward trajectory for the next 12 months, according to a new survey. Still, building societies – the technology laggards of the sector – remain buoyant and even banking is largely positive.
Asked about whether they’d spend more cash on technology in the next 12 months, the balance of respondents in the CBI/PricewaterhouseCoopers quarterly Financial Services Survey was -4%. This is a sharp drop from +51% this time last year, and +55% as late as December last year.
Building societies remained most positive about IT spend, with a balance of +50% anticipating more expenditure, but even this was down from +75% in March. A balance of +12% of respondents in banking said they’d shell out more on IT over the next 12 months, but this was down from +70% in June last year.
Bulge-bracket banks in the US have cut IT spend to a 1.2% increase, according to consultancy Celent, down from an average of 6.9% from 2004-07. But European banks have continued to make front-office investments in technology, it says.
So, if this money is indeed being spent, what are the sectors most likely to need skilled technologists?
Risk management, consigned to the doldrums during the bull market, has now bustled its way to the top of banks’ agendas, says Cubillas Ding, senior consultant at Celent.
“Banks are now cognizant of the need to re-examine their risk management processes and the linkages between how information flows from the front-office trading, middle-office functions and back-office portfolio risk analysis applications.”
He adds that some banks are playing catch-up with their investments in commodities and energy technology and that controls around the capture, pricing and processing of OTC derivatives remain important.
Just anohter cycle. Projects on hold, etc. By the time spending picks up, there’ll be a new, snazzier version of Windows for techies to drool over. Then we’ll see a boom in IT contracting, like in late 90s.