UK - The financial services industry should brace itself for more knocks to already deflated business and employment levels over the next three months as firms face waning demand and further costcutting.
And despite modest economic growth and some market stability, business confidence also continues fall at it fastest rate since September 2001.
According to the latest quarterly survey by the CBI (Confederation of British Industry) and consultants PricewaterhouseCoopers, some 31% of respondents said business was already down during the last three months of 2002, compared with 21% who said that it was up.
The survey recorded a balance of -10 for the final quarter of 2002, against zero in Q1 and Q3 and 43+ in Q2. The results end a rollercoaster year, said the survey. Levels of both domestic- and overseas business fell to -36 points, against -8 in September.
UK banking leader at PwC, John Hitchins, said: The industry ended 2002 in a worried frame of mind, reflecting growing concerns about a slowdown in personal sector business and specific fears on the state of the housing market.
“More jobs are likely to be lost in 2003 as firms grapple with their cost bases in the face of uncertain income prospects.
Overall, the declines were the steepest since December 1992. General insurers reported the biggest growth in business volumes, as did finance houses. But fund managers, life insurers, insurance brokers and stockbrokers were the hardest hit. CBI chief economist, Ian McCafferty, said: 2002 was a difficult year for many parts of the financial services industry especially those affected by the performance of the stock market.
“Across the sector as a whole, the sharp rebound reported in the April to June quarter prompted hopes that the industry would return to its more normal pattern of continuous expansion.
“But subsequent surveys, including this latest snapshot, show that difficult conditions remain.
Professional Pensions is looking to update its list of pensions master trusts in the UK ahead of authorisation. Can you help?
RPMI Railpen is in the next step in the journey towards achieving cost disclosure. Victoria Bell tells Stephanie Baxter about taking part in the Cost Transparency Initiative's pilot phase
Interserve's numerous defined benefit (DB) schemes have retained a sponsor link after the company entered into administration and was sold.
Chris Hannon has been named chairman of the Railways Pensions Trustee Company after a unanimous vote of approval from its board last week.