Commenting on the latest CBI/PwC Financial Services Sector survey, Rain Newton-Smith, CBI Chief Economist, said, "Quarter after quarter after quarter, optimism continues to drop in the financial services sector. Add to that the dive in volumes and profits over the last three months, and it's clear something has to change.
"The sector is the jewel in the crown of the UK's world-leading services industry. While it's encouraging that investment plans have improved, the threat of a 'no deal' Brexit is hitting confidence.
"The Government cannot ignore the voice of this bellwether of the domestic economy and one of the UK's most important globally competitive sectors. No ifs, no buts, the Government must heed the call to avoid a 'no deal' Brexit, and secure an ambitious deal with our largest trading partner."
Andrew Kail, Head of Financial Services at PwC: said, "The deep concerns across the financial services industry, driven by the UK's unresolved political position, cannot be downplayed. As sentiment has taken a further slump this quarter, we've observed a drop-off in plans to launch new products and services as firms batten down the hatches in expectation of a turbulent few months.
"Businesses will be reducing spending on training in the short term, as the focus moves from specialist skills to contingency planning.
CBI director general Carolyn Fairbairn added to the simmering discontent amongst UK business leaders by arguing that no amount of planning can prepare the country for no deal. Her remarks coincided with the opening of The Conservative Party conference in Manchester.