Financial services sector reports strong growth in first quarter

Financial companies said business is only slightly below normal, the best result since the financial crisis began in September 2007, according to the latest CBI/PwC Financial Services Survey.

Asked how their business volumes fared in the three months to March, 33 per cent said that volumes rose and 11 per cent said they fell.

The resulting balance of plus 22 per cent exceeded firms’ expectations.

Growth in business is anticipated to pick up further in the coming three months.

Business volumes grew across the sub-sectors, apart from banking, where volumes were stable, and finance houses where they fell.

Growth was particularly strong for businesses with private individuals, as volumes rose at the fastest pace since December 1996.

Growth was slower for business with industrial & commercial companies, financial institutions and overseas customers.

Ian McCafferty, CBI chief economic adviser, said: “A third quarter of strong volume growth shows the financial services recovery is building strength.

“It is particularly good news that firms consider their level of business to be only slightly below normal, for the first time since the financial crisis began in 2007.

“While business with private individuals has again shown the fastest growth, business with companies also shows some signs of improvement.