According to a new survey, about half of the financial service providers in the UK recorded lower profits during the third quarter of the year.

The survey, which was conducted by the Confederation of British Industry and consultants PricewaterhouseCoopers, showed that 49 per cent of the firms that participated said that their business volume was lower during the third quarter. The survey showed that just 30 per cent of the total 104 firms surveyed said that their business volumes increased during the period. This survey marks the first fall in business volume for the sector since June 2009.

Matthew Fell, the CBI's director for competitive markets said that the situation remains tricky for the financial services sector. He said that the sector has faced a difficult quarter with rising costs and an unexpected fall in sales, which has resulted in lower profitability. He also noted that the business sentiment in the sector continued to fall.

Mr Fell pointed out that uncertainty over demand and the eurozone crisis continued to force firms to cancel investments plans and also cut jobs in the UK. The survey showed that investment managers' optimism about business outlook rose for the third consecutive quarter despite difficult economic situation.