TD Survey Says Technology Spending Drive 2016 Financial Plans



A new survey from TD Bank revealed that 39% of CFOs plan to increase capital spending in 2016, with 58% of those indicating that technology will be the primary area of focus. Other major areas CFOs expect to invest in are existing facilities (44%) and data security (41%).

Despite speculation that the Federal Reserve may soon raise interest rates for the first time in over a decade, the majority of executives reported this would not alter their plans to make business investments in the year ahead. Nearly 75% of executives noted the rate increase would have no impact on their borrowing, and 6% said a rate hike would make them more likely to borrow.

The findings mark a significant improvement from TD’s inaugural survey from 2010 when it reported that only 39% of executives planned to increase capital spending.

“We’ve seen a significant shift in sentiment over the five years we’ve been surveying the market as a number of looming economic headaches have largely subsided,” said Greg Braca, executive vice president and head of Corporate and Specialty Banking at TD Bank. “Rising interest rates may create headline noise which impacts the stock market, but executives are prepared for an eventual rate increase and are moving forward with investments in their infrastructure, facilities and people. It’s clear that businesses have adjusted to the ‘new normal’ and are focused on growing within that environment.”

While 69% of CFOs are optimistic with regard to their business outlook for the year ahead, they expressed some concerns with both day-to-day operations and longer-term performance. Respondents indicated liability risk as the most stressful part of their job, followed by resource planning. Several challenges lie in managing their revenue stream efficiently, with executives noting timeliness in collecting payments (29%), outdated systems creating inefficiencies in operations (21%)and manual processes associated with payment initiation (17%) as distresses in the cash flow cycle.

Government policy continues to be a chief concern for executives as well, though the importance of economic issues has shifted. Healthcare reform and government efficiency rank as the top priorities for executives and resonate as key areas respondents would like 2016 presidential candidates to address in their campaigns. In previous years, TD’s CFO Survey found job creation, federal regulation and monetary policy were among the leading political concerns, indicating a change in executives’ attitudes toward government over the past five years.


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