Investment industry confidence deteriorates as competition for regulatory staff hots up – CBI/ PwC survey

• The UK’s asset and wealth managers continue to be cautious, despite improved profitability last quarter
• Money spent on regulatory compliance is expected to continue to rise over the coming year
• Regulation and compliance professionals are hugely in demand, and the industry expects significant recruitment shortages in this area over the coming 12 months
• Asset and wealth managers do not believe there is a strong demand from their customers for new products/ services

A new survey from the CBI and PwC launched today [16^th June] reveals that asset and wealth managers are concerned about the availability of compliance staff to help them tackle the increasing regulatory burden they expect to face over the coming year.

As willingness to engage in M&A activity and strategic partnerships picks up, the industry appears to be considering alternative ways of improving the efficiency of their business models.

Competition remains unrelenting in the industry, and the expected threat from new market entrants is at its highest point since September 2015.

Mark Pugh, UK asset and wealth management leader at PwC, said:

“Although the industry has seen a relatively positive quarter of financial results, political and economic uncertainty - both in the UK and across the globe - remains a dominant concern for the industry.

“The shortage of compliance staff reflects the acute focus on regulation in the investment industry. As competition to attract the best compliance professionals hots up, organisations are beginning to ask themselves how else they can creatively address their regulatory responsibilities. They are looking for innovative ways to adapt including automation and offshoring as alternatives to competing to hire ever higher numbers of regulatory staff.

“As the FCA has recently shown in its Business Plan, innovation is a priority for the year ahead – asset and wealth managers should combine their focus on regulation with gaining a better understanding of the innovation their customers expect – the two are becoming increasingly linked.”

Ends.

Notes for editors.

1. Mark Pugh is available for interviews. Please contact Ellie Raven on [email protected], +44 (0) 207 804 3663 or +44 (0) 7525 925 830.