Business volumes in the financial services sector fell at a
modest pace in the three months to September, following a rapid
decline in Q2.
The quarterly survey, conducted between 1 and 17 September 2026,
also found that both sentiment and profitability among FS firms
fell at slower rates in the three months to September. Headcount
in the sector rose at a fast pace over the same period.
Looking ahead, FS firms expect business volumes to be broadly
flat next quarter. Firms anticipate increasing investment in IT
and land & buildings, while cutting back capex on vehicles,
plant & machinery.
Key findings:
· Business
volumes declined at a substantially slower pace in the
quarter to September (-5% from -58% in June). Firms expect
volumes to be broadly flat over the next quarter (-1%).
· Sentiment
among FS firms fell at a modest rate in the three months to
September (weighted balance of -7% from -34% in June).
· Average
spreads narrowed at a slower, albeit still firm, rate
over Q3 (-26% from -51% in June). Spreads are expected to be flat
over the next three months (0%).
· The value of
non-performing loans fell at a fast pace in the quarter
to September (-37% from +4% in June). However, their value is set
to grow at a steep rate over the next quarter (+49%).
·
Profitability contracted at a modest pace in the
quarter to September (-6% from -65% in June). FS firms expect
profitability to increase at a firm rate next quarter (+35%).
· Headcount
grew quickly over the three months to September (+49% from +14%
in June). Firms expect to expand headcount at a more moderate
pace in the next three months (+13%).
· FS firms expect to increase
investment in land & buildings and IT over
the next twelve months (compared to the previous twelve), while
capex on vehicles, plant & machinery is set to decline.
Louise Hellem, CBI Chief Economist, said:
Financial services firms reported some stabilisation in business
conditions after a gloomy Q2. The fall in business volumes eased
substantially over Q3, which was mirrored by a slower decline in
sentiment. Looking ahead to the next quarter, firms expect
business volumes to be broadly flat, while headcount is set to
grow for a third consecutive quarter.
The easing downturn matters because the financial services sector
is vital to driving investment, innovation and business growth
across the economy. Government has set the right direction
through its Financial Services Growth and Competitiveness
Strategy and the Leeds Reforms; the priority now is delivery.
The Autumn Budget should set the agenda for a competitive and
predictable environment that turns those reforms into tangible
progress, unlocking domestic investment, deepening UK capital
markets and helping more firms to scale and grow. It should also
avoid measures that would undermine competitiveness or weaken
incentives to invest. With the business tax contribution already
at a record share of receipts, that means avoiding further
sector-specific taxation, including on a banking sector already
facing a higher tax rate than competing international financial
centres.
The full report is attached.
1 October 2026
Notes to Editors:
The latest Financial Services Survey was conducted between 1 and
17 September 2026. There were 63 respondents.
A balance' is the difference in percentage points between the
weighted percentage of firms answering that output is up and the
percentage answering down (for example, if 30% of firms say
thatbusiness volumes are up, 60% thatthey areunchanged, and 10%
thatthey aredown, the balance statistic is +20%).
