Financial services enjoying ‘fast-paced’ growth – Daily Business

Financial services are in growth mode (pic: DB Media Services)

Business volumes in the financial services sector rebounded in the first quarter of 2026 at the fastest rate since December 1996, according to new UK-wide research.

The improvement in activity supported a pick-up in sentiment for the first time since June 2024, alongside a recovery in profitability.

While there was  increased pressure on firms’ margins, the quarterly CBI Financial Services Survey found that firms expect volumes to continue growing at a fast pace next quarter.  

Headcount is anticipated  to rise slightly, after being broadly flat since Q4 2025, but investment intentions for the year ahead remain mixed. Firms plan to increase spending on IT, while reducing capital expenditures on land & buildings and vehicles, plant & machinery.   

The survey was undertaken between 27 February and 18 March, a period which spans the onset of the Iran conflict (from 28 February).  

Alpesh Paleja, CBI deputy chief economist, said:  “The sector still appears to be digesting the implications of conflict in the Middle East.

“This is not surprising given that financial services firms are at the epicentre of volatile market moves, and that the economic impact of the conflict is still crystallising.      

“Navigating through these uncertain times will require the [UK] government to double down on delivering the Financial Services Growth and Competitiveness Strategy.

“Priorities must include continuing to work with the FCA and PRA to streamline unnecessary regulatory burdens, accelerating delivery of the Mansion House reforms, and deploying capital at scale through catalytic finance programmes – including the British Business Bank.”  

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