Restructuring and cost reduction are important themes within the investment banking sector at present, just as they are within investment management, retail banking and the wider financial services and corporate landscape. With growth proving elusive in most developed countries, banks have responded to faltering revenues by shaving large sums off their cost bases. Accountants have an important role to play in this process, particularly at a more senior level where they are able to bring their commercial insight and negotiation skills to bear. Hence employers tend to seek out experienced candidates, who can work with, and influence, important stakeholders in the business.
Retail banks are very much in the regulatory spotlight as a result of their high profile during the financial crisis and their close links with general consumers. Lending has been under huge scrutiny, as has banks’ capital adequacy. So institutions have been hiring accountants to help them fulfil their ever-changing reporting obligations to the Financial Services Authority and other EU regulators. Meanwhile, government proposals to ring-fence banks’ retail operations from their investment arms are creating significant market uncertainty.
Investment management firms have not endured the same level of regulatory scrutiny as their peers in banking with regard to capital adequacy and additional reporting obligations. Nevertheless insurance companies are affected by the Solvency II directive, which comes into effect in 2014 and sets EU-wide capital requirements and risk management standards. While institutional and rich investors are always looking to make money, investment management firms reacted to market uncertainty last year by continuing their previous strategies of moving away from equities towards safer havens such as fixed income bonds.
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