Senior executives of U.S. banks and other financial companies are significantly more optimistic about the prospects for their own firms than they are about the outlook for the nation's economy as a whole.
That's one conclusion of a recent survey of 377 senior executives from various industries, including 76 people employed at U.S. banking, investment banking, brokerage and securities firms. The quarterly survey was sponsored by Grant Thornton, LLP, an audit, tax and business advisory firm in Chicago.
More than 90 percent of the executives surveyed said they were very or somewhat optimistic about their own business, an increase from 85 percent who held that view in the prior quarter. Only 8 percent said they were very or somewhat pessimistic about their own business, a big drop from 15 percent in the earlier three-month period. Optimism clearly was on the rise.
Nonetheless, only 61 percent of the executives said they believed the U.S. economy would improve in the next six months, which is a drop from 72 percent in the prior quarter. Eight percent said they believed the economy would get worse, up from 3 percent in the earlier period. In this context, pessimism was on an upswing.
Nichole Jordan, national banking and securities industry leader at Grant Thornton, noted in a statement that the financial services industry is facing unprecedented change, a climate that often offers opportunities.
"Financial services firms are more optimistic about their own business prospects -- we've seen that firms are focusing on organic growth and mergers as ways to get ahead in the current environment," Jordan said.
Another sign of optimism: 44 percent of the executives said they planned to hire more people, which is a proportion that was virtually unchanged from the prior-quarter's survey.
Perhaps not surprisingly, the executives took a dim view of the Dodd-Frank Wall Street Reform and Consumer Protection Act, enacted almost a year ago. Fifty-eight percent said the law wouldn't help to improve accountability and transparency in the U.S. financial system. Only 42 percent believed the law would strengthen those factors.
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