A good yearWith London's Square Mile quietening down for Christmas, Mark Boleat, Chairman of the Policy and Resources Committee of the City of London, takes the opportunity to reflect at CityAM.com on the past 12 months.
Generally speaking, Boleat believes 2014 has been a good year for the financial services industry. "Our trade surplus in financial services is the biggest in the world, we have a buoyant initial public offering market, and the tax contribution made by financial services to the Treasury's coffers accounts for 11.5% of all receipts," he said.
87
The number of profit warnings issued by FTSE 350 companies in 2014 up to mid-December
$3.27tn
The global deal volume reached by the M&A sector to date in 2014But it wasn't all plain sailing this year, adds Boleat. With the ongoing threat of deflation in the eurozone and parts of the industry still "engulfed in scandal" as a result of foreign exchange traders' behaviour, the City faced its fair share of challenges.
Nevertheless, he concludes: "We can still look back on a positive year for the City in 2014. Here's hoping for the same in 2015."
CityAM.com opinion Advisers in demand
For many in UK financial services, 2014 will be remembered most for the Budget, reckons David Thompson, Managing Director of Business Development and Proposition at AXA Wealth.
In a column for the Professional Adviser website, Thompson reflects on the UK Chancellor's announcement that from April next year, people looking to retire will have more flexibility in the way they access their pensions.
According to Thompson,
the new pensions rules will mean more work for financial advisers. "While the additional flexibility and choice is great, it also has the potential to highlight the complex nature of retirement planning," he said. "Professional financial advice is going to be crucial to ensure your money lasts as long as you do."
Looking ahead to 2015, he predicts: "If we set aside pensions flexibility for a moment, I anticipate we'll see acceleration toward restricted advice models, more chatter around investment processes and the start of preparations for sunset clause activity."
Professional Adviser piece
Winter warning
Looking back, there was little festive cheer in a new survey from EY, which found that 2014 has been the worst for profit warnings from the UK's largest listed companies since the depths of the financial crisis.
The professional services firm's survey found that in the year to mid-December, FTSE 350 companies issued 87 profit warnings - just three less than in 2008, reports the
Financial Times.
"This number of companies issuing warnings indicates that a significant part of the market is having trouble with planning and forecasting processes or with communicating with the City," said Keith McGregor, a restructuring partner at EY.
UK corporates can expect a happier new year, however, according to S&P Capital IQ. The financial information provider has reported that the 12-month forward price/earnings multiple for the FTSE 350 is currently about 13.5 times, slightly ahead of the rating at the same time last year and further ahead of the equivalent period in 2012.
Financial Times story
Sealing the dealThe mergers and acquisitions (M&A) sector will be hoping for more of the same in 2015, after a year in which the global value for M&A rose to its highest annual level since 2007, reports Reuters.
According to data from Thomson Reuters, global deal volume has reached $3.27tn - up 40% from the same period last year. "The need to stay competitive and strengthen the core business is the main catalyst," explained Wilhelm Schulz, Head of M&A in Europe, Middle East and Africa at Citi.
According to Reuters, the total was boosted by a rush of large deals in the telecoms, healthcare and consumer sectors, with transactions, some of which had been contemplated for years, promising to cause a chain reaction as rivals move to defend their territory.
Reuters added: "While the recent slump in oil prices and rise in political tensions could spell trouble for M&A activity next year, the appetite for big deals shows no sign of weakening yet."
Reuters article
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