Global IT spending by financial services firms is set to reach $357.4 billion in 2010, an increase of 2.9% over 2009, as the tentative recovery picks up, according to research from Celent.
The figure compares to a 2.5% decline in growth in 2009 and will be followed by more robust spending on IT products and services of 4.9% CAGR from 2010 to 2012.
Firms in Europe and North America account for 36% and 33.1%, respectively, of the global IT investments by financial services institutions. Asia Pacific accounts for 25.2%, with Latin America and Africa making up the remaining 5.7%.
Among all regions, the fastest growth will be seen in financial services institutions in Asia Pacific, with IT spending increasing at 5.1% in 2010 and a CAGR of 6.2% from 2010 to 2012, when it is expected to reach $101.7 billion.
Spending in North America and Europe will climb more slowly, at a CAGR of around 4.5% from 2010 to 2012. Latin America and Africa are expected to grow at a relatively modest rate of 3.2% with spending in this region of $21.2 billion in 2010.
Spending on banking activities accounts for the largest portion of total IT outlay - nearly 50%, or $163 billion in 2010. Spending on insurance and securities and investments activities are expected to reach $103.9 billion and $70.1 billion, respectively.
Maintenance is still the biggest drain on funds, accounting for a massive 72.7% of total IT spending in 2008 although this figure should drop to 70% in 2012, says Celent.
Jacob Jegher, senior analyst, banking group, Celent, says: "After a difficult 2009, growth rates are starting to climb across all regions. 2010 has the potential to be the start of a turnaround, but there is still plenty of uncertainty in the industry and we are not completely out of the woods."