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IT and technology spending by financial services set to decline
The rate of growth of IT and technology spending within the European financial services sector is set to fall over the coming years as the global credit crunch takes its toll, a new report has concluded.
According to the latest research carried out by Celnet, the sector will spend around £67.6 billion on IT and technology in 2008 and £72 billion the following year.
However, the 2007 figure represents an annual growth rate of 5.9 per cent, significantly below the 8.7 per cent rate of growth witnessed in 2006.
Commenting on the Europe-wide trend, Jacob Jegher, senior analyst at Celent's banking division, said: "Growth rates have dropped across all regions, contributing to this lower total. US financial institutions have been hit particularly hard and challenges in this region are contributing to growth declines.
"The credit crunch and looming economic uncertainty have North American financial institutions tightening their belts. Ripples from the US sub-prime crisis are likely to have a dampening effect on other regions as well."
The report also concluded that global spending on IT products and outsourcing of operations will grow to £195.4 billion by 2009.
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