The number of UK financial institutions increasing investment and accelerating expansion plans is on the rise as economic conditions continue to improve, says Lloyds Bank.
According to the bank’s ninth Financial Institutions Sentiment Survey, nearly half (48%) of senior decision makers believe economic growth will improve over the next 12 months, more than double the 21% who said the same in 2023. Similarly, 43% expect growth in the financial sector, up from 27% in 2023 and 12% in 2022.
Meanwhile, 68% of financial institutions feel optimistic about the UK economy beyond 2025 and 62% share a similar optimism for growth in the financial services sector.
Lloyds said the rise in optimism is helping to fuel financial institutions’ own growth prospects. Nearly three fifths (59%) feel more positive about their growth over the next year, with 63% looking to expand in existing markets and 50% planning on entering new markets. In addition, half of financial institutions surveyed also said they are planning to launch new products and services.
Lisa Francis, head of institutional coverage at Lloyds Bank Corporate and Institutional Banking, said: “This year’s survey has revealed a significant shift towards optimism in both the UK economy and the financial services sector. Deal activity is ahead of last year and there’s positive momentum as this renewed optimism is fuelling our clients growth ambitions, whether by expanding into new and existing markets or launching new products and services.
“Overall, this paints an exciting picture for the UK’s financial services industry, which is crucial to the UK’s economy and our position on the global stage.”
The survey also revealed growing confidence in London as a leading financial hub, with 63% of respondents believing the capital will retain its position on the global stage, up from 50% in 2023.
However, financial institutions cited various barriers to expansion, with 62% concerned about geopolitical uncertainty and 41% citing productivity challenges facing the UK.
