Financial services firms have enjoyed a third consecutive quarter of robust growth with increases in business, jobs and profits.
Across the sector, 20 per cent more firms said business volumes had grown rather than declined in the three months to March, according to the quarterly Financial Services Survey by the CBI and accountants PricewaterhouseCoopers released today.
Business with private individuals has driven the expansion while transactions with industrial and commercial companies and financial institutions showed only a relatively modest improvement.
The survey covers all major financial services including banks, building societies, traders, fund managers, insurance companies and brokers in the UK.
Income from fees, commission and premiums grew strongly.
Profits surged faster than predicted, and firms anticipate that profitability will strengthen further in the next quarter, as expectations are for more rapid v olume growth and a firmer grip on rising total costs. The acceleration in business produced a further jump in jobs with 31 per cent more firms taking on employees than shedding them.
A nother increase is expected over the next three months, albeit at a slightly slower pace.
Business optimism in the sector also increased in the three months to March.
However total operating costs went up at their fastest rate ever.
And, worryingly, the value of non-performing loans - where customers are not paying interest or repaying capital as agreed - was ahead for the fourth successive quarter and is expected to go up again over the next quarter.
The most recent rise in business with individuals has been driven by the upturn in housing transactions.