After a flat 2010, global spending on IT vendors by the financial markets sector will return to growth next year, according to analyst Ovum.
In its latest report, the firm forecasts 4.5% growth in 2011 after a tiny rise of 0.3% this year and a 4.2% decline in 2009.
According to the report author, Daniel Mayo, the growth will be driven by businesses striving to improve their performance and agility and a need to invest significantly in compliance and reporting systems.
"The financial markets sector as a whole will be volatile in 2011, but this will not be detrimental to IT spending and will provide significant opportunities for vendors. Businesses will be looking for IT systems that ensure their front offices are performing as well as they can, while they will want to make their back offices more automated," says Mayo.
While all this will drive strong growth opportunities for vendors, according to Mayo, procurement departments will still be looking to drive down prices and decision making will be volatile as institutions freeze or delay projects in response to market changes. He also stresses the growing importance of Asia Pacific.
"London and New York will remain the key hubs but banks will shift some of their power to the Asia region, which will become more and more influential as senior executives relocate there. For this reason, a credible presence in Asia will be critical for vendors in 2011," concludes the analyst.