Finance firms adapt to Covid-19

The Covid -19 pandemic is expected to change the landscape for financial institutions, with eight in ten firms planning to embrace technology that supports flexible working in the long term.

A new report by Lloyds Bank suggests that 89 p er cent of financial services firms plan to maintain flexible working patterns for employees, with 81 per cent expecting to use digital platforms such as Microsoft Teams and Zoom to liaise with clients.

Some two-thirds (68 per cent) will use new technol - ogy to automate more work, according to the bank’s fifth annual financial institutions sentiment survey, which gathers views from major banks, asset and wealth management firms, insurers and intermediaries.

Six in ten (62 per cent) senior leaders within financial institutions say they expect to maintain or grow revenues over the next 12 months. Although this is down from 80 per cent in 2019, the figures indicate many firms expect their business to show resilience despite the disruption caused by coronavirus.

However, two-thirds (68 per cent) of respondents expect UK economic growth to slow in the year ahead, compared with 58 per cent in 2019 and just 29 per cent in 2018.

Adrian Walk ling, head of financial services at Lloyds Bank Commercial Banking, said: “A drop in confidence in the sector’s growth prospects compared to last year reflects how financial institutions are feeling in the midst of unprecedented disruption caused by Covid-19.

“Firms have spent the past decade de-risking and modifying their business models with the aim of increasing their resilience. The next 12 months will be critical as we see how effective those defences are for financial services and the wider UK economy.

“Our findings show that Covid-19 is accelerating the use of technology to help firms adapt to new working patterns.”