According to the latest CBI/PwC quarterly Financial Services Survey on investment management, launched today, business volumes were higher during the quarter to December, with a large majority of investment managers also reporting higher fee income.
The survey said volumes are expected to rise further next quarter as pricing power improves and costs fall. Staffing levels are increasing rapidly, said the survey, driven primarily by increased demand.
Paula Smith, PwC’s UK asset management leader, said investment managers have remained remarkably optimistic over the last quarter.
“Rising equity markets, higher fee incomes and increased profitability are all contributing factors to this bullish confidence that volumes and revenues will continue to grow over the next quarter.”
However Smith sounded a note of caution, stressing asset managers must remain aware of the increasing pressure of compliance costs, as the requirements from the regulator get more complex and controls tighten.
“This is making operational effectiveness key for many firms, and driving increased investment in headcount as firms look to bolster compliance departments to get in shape to deal with these challenges.”
