A new report from Aite Group that examines IT spending by capital markets firms says operational efficiency remains the top priority for the year among technology executives allocating budgets for IT initiatives. While risk management, systems integration, back office settlement and front office workstations will be the top systems priorities, enterprise data management projects will lead core technology implementations, the analyst predicts.
Aite Group expects 2008 IT budgets at capital markets firms to continue to grow, but says the rate of growth should be slower than that of 2007. This year’s budgets will be slightly less than 10 per cent higher than last year’s, on average. Based on the increase, Aite Group anticipates US capital markets companies will spend roughly $3.7 billion more on IT initiatives in 2008 than in 2007.
“As many anticipated, revenue forecasts for 2008 are not particularly optimistic,” says Adam Honoré, senior analyst with Aite Group and author of this report. “However, the pace of market change may not allow capital markets firms to slow their technology spending. Like never before, technology is a differentiator in high-speed trading. Meanwhile, investment advisors need to spend on systems that can help them customize strategies for an increasingly nervous client base.”