World bank IT spending to hit £117bn this year

Total bank IT spending across North America, Europe and the Asia-Pacific region will grow to $188 billion (£117 billion) in 2014, an increase of around 4.4 percent over 2013, according to research.

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Total bank IT spending across North America, Europe and the Asia-Pacific region will grow to $188 billion (£117 billion) in 2014, an increase of around 4.4 percent over 2013, according to research.

In its report, "IT Spending in Banking: A Global Perspective", research firm Celent says the majority of the growth is coming from Asia-Pacific banks.

Spending by banks in this region will grow by 5.8 percent in 2014 to $66.5 billion. This growth will remain relatively consistent in 2015, although it will decline slightly, said Celent.

US and Canadian banks are also reporting positive spending growth. North American banks’ spending will grow by a solid 4.5 percent in 2014 to $59.5 billion. This figure will increase to 4.6 percent in 2016 to $62.2 billion.

European spending figures have been revised to reflect "continued improvement in 2013" after the economic crisis, Celent said. Spending by European banks will grow 2.9 percent in 2014 to $62.1 billion. European spending growth will also continue to ramp up through 2016, as spending increases by 4.3 percent to $67.1 billion.

“Banks across the globe are devoting significant resources to technology,” said Jacob Jegher, an analyst at Celent. “They are emphasising innovation and new technology investments. When examining the sum of IT spending across the three regions, IT spending is expected to grow by 4.6 percent in 2015 and 4.7 percent in 2016.”

The report says regulation is continuing to drive IT spending in banks globally, but that regulation "is probably felt more in Europe than anywhere else", since European banks have to comply with both local and European laws.

Also, because the world economic crisis had its biggest impact on European banks, says the report, "the regulators seek not only to add safeguards and ways of identifying similar issues earlier", but to also "reshape the industry, and, in some cases, to fundamentally change the businesses banks operate in".

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