Financial services' profits fall
Financial services firms have experienced the biggest fall in profitability since 1991 according to the latest CBI/PricewaterhouseCoopers survey on the sector.
The sector has also seen its biggest drop in business volumes for nine years, forcing companies to cut costs in order to maintain profitability.Employment has fallen for the second quarter running in this sector whichhas experienced growing employment rates since 1997. Companies expect more job cuts in the next three months.
Marketing expenditure has also dropped for the second consecutive quarter IT expenditure was cut for the first time since September 1992.
Financial services partner John Hitchins said the survey showed the industry remained concerned about the survey.
‘With a clear focus on cost cutting, the sector looks poised to react according to how markets settle following the launch of the Euro and the steady resumption of business activity after the holiday season and post September 11,’ he added.