The latest Indicators Report by Ansarada found a 43 per cent increase in new deals in the finance industry over the last quarter, driven by offshore investors.
Interest from the US increased by 3,500 per cent to have them as the largest investor in the finance industry with 38 per cent, but another spike was found in Singapore where interest increased by 267 per cent to 4 per cent of the industries’ total.
The Indicators Report is created from the data sets collected through the Ansarada platform and concluded that the increase in deals was an indicator that investors were comfortable with the changes put in motion by commissioner Kenneth Hayne in his final report.
Ansarada chief executive and co-founder Sam Riley said the long-term outcomes for the industry due to the commission were positive and would ensure the health of the system.
“Whilst the finance industry may be approaching the royal commission recommendations with a feeling of pain for the reform required, we see the outcomes as a huge gain for customers and the long-term health of our banking system,” he said.
Mr Riley said that now was a good time for the industry to look outwards at new and emerging players that could provide solutions to legacy issues.
“The industry needs to adopt and embrace smart and nimble technology that will actively respond to the recommendations by surfacing market and business risks early, enabling challenges to be addressed before they mature, and provide greater transparency for boards to make informed decisions in the best interests of the organisation and it’s shareholders,” he said.
Mr Riley said that the Indicators Report offered visibility into the deal landscape to paint an accurate depiction of the trends emerging, which allowed for better decision-making.
“The latest edition highlights that even in the face of intense scrutiny and calls for greater regulation, our financial sector continues to thrive. Over the coming months, we expect this confidence to continue as the industry begins to embrace reform,” he said.
One of the biggest winners in the financial industry was the fintech sector, which had recorded US$600 million across deals in 2018.
Fintech had now overtaken the tech sector in attracting investors, likely driven by companies that were solving regulatory and supervisory problems in the market.
KPMG Australia’s head of banking and global co-lead for fintech, Ian Pollari, predicted that interest in the fintech industry would only rise in 2019.
“In particular, this will be in areas such as conduct risk, regulatory compliance, income and expense verification,” said Mr Pollari.