Financial Services IT spending hit $342.1 billion in 2007 up 5.9% on 2006 but below that year’s 8.7% growth.
Despite challenging conditions IT investment is expected to have a compound annual growth rate of 6.3% between 2007 and 09 when it will reach $386.7 billion.
The figures are based on trends analysed by researcher Celent which examines banking, insurance, and securities and investments in North America, Europe, and the Asia-Pacific regions, in addition to an overview of Latin America and Africa.
“Growth rates have dropped across all regions, contributing to this lower total,” says Jacob Jegher, senior analyst in Celent's banking group and co-author of the report. “US financial institutions have been hit particularly hard and challenges in this region are contributing to growth declines. The credit crunch and looming economic uncertainty have North American financial institutions tightening their belts. Ripples from the US subprime crisis are likely to have a dampening effect on other regions as well.”