IT Spending in Banking: A North American Perspective
North American IT spending growth is growing, albeit slowly, and is expected to be 2.4% higher in 2012. Growth will climb slowly in 2013 as IT spending by North American banks reaches US$56.3 billion, an increase of 2.9%. There is still plenty of uncertainty in the United States, and the next couple of years are going to be rocky.
In a new report, IT Spending in Banking: A North American Perspective, Celent examines, analyzes, and contrasts the IT spending patterns of US and Canadian banks. North American bank IT spending will grow from US$53.4 billion in 2011 to US$54.7 billion in 2012. Canadian banks are leading the charge. Spending on corporate banking will continue to be strong, and compliance, regulatory, and security spending are all rising dramatically. With that said, it’s not all fine and dandy; retail banking IT spending in the US is being stifled, new investment spending is limited, and maintenance spending is still tying up IT budgets.
“Although banks have invested in system modernization and are attempting to become more efficient, they are unable to escape the maintenance conundrum,” says Jacob Jegher, Senior Analyst with Celent's Banking Group and author of the report.
“The good news is that the percentage of funds allocated to maintenance is slowly declining,” he adds. “There is, however, a stark paradox in the market—the trend toward enhancing and revamping self-service channels requires significant investment, and access to these funds is severely limited.”
This report examines the regional breakdowns of retail versus wholesale spending, internal versus external spending, and maintenance spending versus new investments. The report also outlines several key North American banking technology trends and growth areas for 2012.