24 July 2017
visit www.avoka.com

IT budgets up as firms wilt under compliance burden

26 January 2005  |  9484 views  |  0 Finextra report 2

Finextra's annual Financial Technology Strategies report finds financial market firms preparing to raise IT budgets in an effort to boost operational efficiencies and comply with regulatory demands for increased information.

The survey of a broad cross-section of 92 financial markets participants, finds IT budgets and staff recruitment on the rise for the second successive year. But a shared sense of optimism is tempered by a hard-edged determination to see a measurable return on investment, implying a continued tough market for the fintech vendor community.

The sheer weight of the compliance burden and the systems integration challenge it entails has put a reality check on the ambitions of institutions responding to this year’s survey. In 2004, 60% of organisations considered regulations an extension of existing systems and process. This year, only 46% agree with the same statement.

Fewer capital markets firms see an opportunity to use compliance to create internal value, down from 45% last year to 36% in 2005. Only 29% believe they can create any external value from regulations, down 10% over the last twelve months. Indeed, more respondents than ever before now view regulations as an administrative overhead with minimal benefit to their organisation.

The biggest pure IT change over the last twelve months has been the growing support for Linux within wholesale finance organisations, from 27% in 2004 to 58% in 2005.

"Regulatory compliance and risk management are at the forefront, but the pressure for IT to deliver measurable business returns is also growing," says Paul Penrose, head of research at Finextra. "Finding ways to meet regulatory demands for stricter compliance, while managing business expectations for an improved return on IT investment, will be the real challenge for CIOs in the year ahead."

The full report, Financial Technology Strategies 2005, is available to order online: Financial Technology Strategies 2005.

It will be released at Finextra's third annual Finexpo City Technology Strategies conference and exhibition, www.finexpo.com/cts/, taking place at Cabot Hall in the heart of London’s docklands on Thursday 27 January.

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

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

Related stories

IT budgets forecast to show biggest rise for four years

IT budgets forecast to show biggest rise for four years

14 January 2005  |  4446 views  |  0 comments
Risk rises up the agenda, but IT issues remain a challenge

Risk rises up the agenda, but IT issues remain a challenge

12 January 2005  |  5592 views  |  0 comments
Top speakers and vendors lined up for Finexpo

Top speakers and vendors lined up for Finexpo

21 December 2004  |  4562 views  |  0 comments
Financial IT spending to hit $362bn in 2005 - TowerGroup

Financial IT spending to hit $362bn in 2005 - TowerGroup

16 December 2004  |  5718 views  |  0 comments
Strain on IT shows as banks adopt business-focussed approach to compliance

Strain on IT shows as banks adopt business-focussed approach to compliance

24 September 2004  |  5730 views  |  0 comments
IT budgets rebound but software spending downturn continues

IT budgets rebound but software spending downturn continues

27 January 2004  |  5062 views  |  0 comments

Related blogs

Create a blog about this story (membership required)
visit www.worldpaymentsreport.comvisit www.abe-eba.euvisit www.ncr.com

Top topics

Most viewed Most shared
Mastercard to buy AI outfit BrighterionMastercard to buy AI outfit Brighterion
10793 views comments | 14 tweets | 20 linkedin
Barclays rides payments-as-a-service wave with investment in Form3Barclays rides payments-as-a-service wave...
9670 views comments | 16 tweets | 12 linkedin
Mastercard and Scotiabank join Enterprise Ethereum AllianceMastercard and Scotiabank join Enterprise...
8421 views comments | 25 tweets | 16 linkedin
PayPal strikes deals with Chase and CitiPayPal strikes deals with Chase and Citi
8336 views comments | 10 tweets | 5 linkedin
UK judge blocks £14bn class action suit against MastercardUK judge blocks £14bn class action su...
8278 views comments | 5 tweets | 6 linkedin

Featured job

Competitive
London, UK (or flexible)

Find your next job