Global information technology spending by financial services institutions is expected to reach US$357.4 billion in 2010, an increase of 2.9% over 2009. This figure is substantially higher than the 2.5% decline in growth experienced in 2009. Although 2010 will be challenging, global spending on IT products and services should grow to US$393.5 billion by 2012, a 4.9% CAGR from 2010 to 2012.
In a new report, "IT Spending in Financial Services: A Global Perspective," Celent analyses IT spending trends across different industry verticals (banking, insurance, and securities and investments) and different regions (North America, Europe, the Asia-Pacific region, Latin America, and Africa). The prime focus of the report is to compare and contrast the direction of IT spending trends among financial services institutions.
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. Growth will continue to rise in this region, and total spending in Asia-Pacific is expected to reach US$101.7 billion in 2012. Latin America and Africa are expected to grow at a relatively modest rate (3%). Spending in this region will grow to US$20.4 billion in 2010.
Meanwhile, European and North American financial institutions currently spend an almost equal amount on IT. Firms in Europe and North America account for 36% and 33.1%, respectively, of the global IT investments by financial services institutions. Firms in Asia-Pacific account for 25.2%, and Latin America and Africa account for the remaining 5.7%.
"After a difficult 2009, growth rates are starting to climb across all regions,” says Jacob Jegher, senior analyst with Celent's Banking Group and coauthor of the report. “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."