Investment banks are increasing their IT spending at a faster rate in Asia-Pacific as the region's economies grow in their importance on the global stage, according to the latest research from Ovum.
Global financial markets, which includes capital markets, corporate banking, and the investment sector, will see IT spending reach about $90bn in 2015 as companies update risk management and reporting systems to fall into line with industry regulations.
China will see the highest growth with 8.8% average growth rate each year between 2011 and 2015. Hong Kong and Singapore will see similar growth rates of 8.1% and 7.1% respectively. Meanwhile UK capital market IT spending will increase annually by 5.8% while the US grows 6% over the same period.
Ovum analyst Daniel Mayo says decision making power is moving away from London and New York: "While there will be growth in nearly every major market, the Asia-Pacific countries will be at the forefront. This is mainly due to global companies shifting their decision-making power from New York and London to cities such as Beijing, because of their growing economic influence."
The financial markets segment that will see the strongest increase in spending is the hedge fund sector, which was one of the hardest hit during the recession.
IT spending by hedge funds will increase 11.1% over the same period and spending will reach pre-recession levels by the end of next year.
"The hedge funds market was badly affected by the financial crash, with investors staying away due to its disastrous performance. As a result, investment in IT fell significantly in 2008 and 2009," said Mayo. "However, investors seeking the high returns it can once again provide have come back, and IT investment is slowly growing as a result,"