Current state of Financial institutions

The year 2020 being a challenging one for the markets of European asset management industries, unprecedented changes were faced by firms because of the recessions. As many employees were forced to work from as the immediate consequences of the pandemic entitled. That came with little to no preparation time with sudden sell-offs of the market creating a major global liquidity shortage.

State Street conducted several researches to assess their employees especially their asset managers’ performances. And to the surprise they found satisfactory responses from their managers through the perspective of their institutional clients and also their investment advisers, European managers scored high through the bear markets.

Multiple questions like what will be the pandemic’s effects on asset management,

How the changes will be brought about? What will be the long term operations? Whether to have a different way of tackling things or to stick to the same old methods of pre-Covid times etc., was asked after there was calm in the air again.

 State Street conducted another survey in autumn of more than 600 investment institutions all over the world which included 91 European asset management organisations with the same set of questions. The results were similar to the ones of their previous surveys. There was a sense of fighting back and consolidation in top line results. European asset managers are focused on getting back their lost returns for their portfolios which made them to have their top growth objective as improve investment performance. 45% of the investors were ready to engage their companies, a long-standing trend in the asset management in a merger or an acquisition deal in the coming 10 to 12 months in Europe and beyond.

In the year 2018, a Brexit deal was not possible between the European Union and a majority of UK members of the parliament and the confidence on the targets of meeting the growth were very low. The European managers had a comparatively higher confidence this year (52%) but lower than of last year (61%).

 82 % of the European managers were confident in meeting their goals on a five-year Horizon. As the pandemic stroked the markets , the post-Covid taxation was to be paid to government expenditure which made a threat to the growth placing only 38% of the European asset managers placing in their top three.

One of the interesting results of the survey was the extent to which work from home experience is expected to become the new normal. Almost 55% of the European asset management firms have said that most of their employees will continue to work from home now onwards. A lasting move to work remotely and confirming the need to accelerate existing projects like digital transformation.