30 November 2015

US banks to increase IT spending

16 January 2002  |  3071 views  |  0 abacus

US banks will increase their IT spending this year by over 4% compared to 2001, according to a new report from Celent Communications.

The report predicts that despite the current recessionary environment in the USA, banks will spend over $34 billion on technology in 2002. Celent suggests top banks are spending in excess of $2 billion each annually on technology, with the largest bank reaching a spending level of $5 billion in 2002.

The figures chime with the results of a recent Gartner/SoundView survey of IT executives which forecast a five per cent increase in technology spending in the financial sector. According to the survey results, vendors in the security, storage, Web-based applications, PDA and Web integration services arenas are most likely to attract new spending in 2002. Mainframe, contract labour services and desktop products and services are low on the priority list

Octavio Marenzi, managing director at Celent, notes: "A very large proportion of their spending is on maintaining existing infrastructure. However, banks are also increasingly viewing technology as a competitive differentiator, as a tool with which to wrest market share from their competition."

The Celent report points to consolidation in the banking industry as a key driver of increased spending on IT. According to Octavio Marenzi this is because larger banks do not only spend more on IT than smaller institutions, they spend a greater percentage overall.

"The largest commercial banks in the USA spend as much as 25% of their total expenses on IT, with certain specialist banks spending even higher percentages. Small banks tend to spend a far lower percentage of their total expenses on technology," says Marenzi.

Comments: (0)

Comment on this story (membership required)
Log in to receive notifications when someone posts a comment

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board, sign up now.

Related blogs

Create a blog about this story (membership required)

Related stories

11 January, 2002
10 January, 2002
03 January, 2002
18 December, 2001
14 December, 2001
05 December, 2001
26 November, 2001
Your browser is unable to support Flash files.

Top topics

Most viewed Most shared
BBVA buys 29.5% stake in Atom for £45...
8059 views comments | 34 tweets | 42 linkedin
Former Barclays chief forecasts massive jo...
6871 views comments | 29 tweets | 35 linkedin
BNP Paribas to test contactless payment di...
6295 views comments | 17 tweets | 25 linkedin
WeChat launches mobile wallet in South Afr...
6045 views comments | 19 tweets | 15 linkedin
Hilton confirms data breach
5674 views comments | 11 tweets | 17 linkedin

Featured job

Brussels (Belgium) or Paris (France)

Find your next job