Sentiment in the UK financial services industry continues to deteriorate in early 2009, according to the CBI.
In its quarterly survey of the industry, the CBI found the industry is not as pessimistic as it was in late 2008, but trends are still firmly negative.
Banks, building societies, investment managers and security traders are the least optimistic about the future, tough life insurance companies are less negative, and general insurance firms are feeling positive about business in the coming months.
However, more than two thirds of respondents to the survey felt the financial crisis has damaged competitiveness in the UK.
The report says: "This is a striking response. No global financial centre has been untouched by recent events, but at a time when most firms are scaling back their investment plans, the UK industry needs to keep its eye on long-term competitiveness and ensure that it is developing considered and innovative strategies for the future."
Its comments echo last week's call from Alistair Darling to ensure the FSA does not over-regulate the industry and stifle innovation.
Financial services companies also expect to lay off more staff in the coming months, with the exception of general insurers, which plan to increase their headcount. Firms are also more interested in retaining their current customers than marketing to new ones.
The CBI believes the sector will continue to face difficult times, with more jobs to go during 2009 and a greater focus on maintaining core business, rather than chasing new customers.
Contact: John Bakie, Tel: 020 7484 9805, e-mail: [email protected]IFAonline
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