UK financial services firms may now begin to hire

U.K. financial firms may hire in the third quarter after cutting a worse-than-estimated 10,000 jobs in the three months through June, according to the Confederation of British Industry.

Bloomberg News reports that Banks, insurers and asset managers may add about 1,000 positions in the coming three months, Britain’s biggest business lobby group and accounting firm PricewaterhouseCoopers LLP said in a study published Monday.

Kevin Burrowes, PwC’s UK financial services leader, said: 'Banking confidence continues to grow, increasing at the fastest rate since 2000. The banks’ upbeat mood is supported by many factors including a strong rise in business volumes and strong activity with commercial and retail customers. This may not mean that credit appetite is growing, but it certainly implies an improvement in economic performance.

'After allowing costs to rise in the first quarter of the year, banks are renewing their focus on efficiency and staff numbers are beginning to fall again. Retail and commercial non-performing loans are also predicted to decline during the coming quarter.

There are a few notes of caution. Despite planning for customer acquisition and product development, banks still have doubts about continuing demand. They see new entrants as a growing threat, which is perhaps due to the Prudential Regulation Authority’s plans to relax capital and liquidity rules for new banks'.

Paula Smith, PwC’s UK asset management leader, said: 'Investment managers are more optimistic due to strong improvement in revenues and profitability, with the latter increasing for the sixth consecutive quarter. Firms continue to benefit from the comparative stability of financial markets, as well as the year-long recovery in equity values.

'Encouraged by this, investment managers continue to allow operating costs to climb, although the pace of growth appears to have slowed with employment levels being the highest since 2010.

'Despite the gradually improving clarity around supervisory changes, investment managers think regulation is the biggest obstacle to the sector’s growth. The proposed EU bonus cap is of particular concern with investment managers expecting the proposal to make staffing costs less flexible and increase difficulty in retaining talent'.

U.K. Financial Firms Seen Hiring After Eliminating 10,000 Jobs

Business continues to grow and optimism rise in financial services sector

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