Financial decision makers rate access to skills among top risks in the next 12 months


Lloyds Bank’s sixth Financial Institutions Sentiment Survey 2021[1] has found that financial decision makers rate regulatory change, workforce management, access to skills, market risk and cybercrime amongst the top five significant risks within the next 12 months. Yet, the survey also found that fewer firms rate cyber resilience as a strategic priority for the coming year. We review some of the outcomes from the survey report and consider key implications.


Lloyds Bank’s sixth Financial Institutions Sentiment Survey 2021 collected the latest views of more than 100 senior decision-makers at UK banks, wealth and asset managers, insurers, financial sponsors and intermediaries between 15 June and 19 July 2021. Results from the survey indicated that:


say that technology, automation, and digital investment is a top strategic priority.


are investing in technology to improve the client experience.


say that regulatory change is a significant risk to their business.


expect to grow headcount.

The survey found that almost nine in 10 (88%) financial decision makers expect UK economic growth to improve over the next year, noting that this expectation is being driven by ‘businesses ramping up to full capacity, workers returning, and pent-up demand being released’.

However, the commentary suggested that overall enthusiasm should be tempered, with Lloyds Bank citing that their July 2021 Bank UK Recovery Tracker – which surveys 14 business sectors – had revealed ‘a drop in overall business optimism driven by concerns of over inflation, constrained capacity and access to skilled workers’.

Yet, bolstered by stabilising financial markets and ‘bullish’ expectations of post-pandemic growth, almost three times more firms plan to recruit compared to last year (44% vs 14%).

50% of insurers and 26% of banks plan to create new jobs in the next year. However, 37% ‘flagged a lack of access to skills as a risk’, with the report asserting that this could mean more firms targeting other sectors in search for talent.

Top 5 most significant risks in the next year*

  • Regulatory change 64% 64%
  • Cybercrime 50% 50%
  • Financial market risk 47% 47%
  • Managing workforce 39% 39%
  • Access to skills 37% 37%

*Source: Lloyds Bank, ‘Financial Institutions Sentiment Survey 2021’.

Regulatory change – up from 46% to 64% on last year – takes primary spot in terms of the biggest threat, with cybercrime, financial market risk, managing workforce and access to skills being ranked amongst the top five most significant risks in the next 12 months.

Technology, automation, and digital investment remain the top strategic priorities; cited by 77% of respondents, with four in five (80%) expecting to actively grow their investment in tech systems and core platforms.

Improving client experience was collectively asserted to be the primary objective of their investment (71%), alongside driving growth (60%) and boosting productivity (59%). Investment in Machine learning and Artificial Intelligence (AI) were also specifically noted by 69%.

46% of the firms Lloyds spoke with also said they will look to grow investment in their FinTech capability too, as there is a ‘continued [positive] focus on partnering with FinTechs[…]to [find] new solutions to meet changing client needs through collaboration’.

The primary benefits that firms expected to see from their technological investments included: better client experience, growth, improved productivity, cyber resilience, and competitive advantage.

Top 5 benefits expected from increased technology investment*

  • Better client experience 71% 71%
  • Growth 60% 60%
  • Improved productivity 59% 59%
  • Cyber resilience 51% 51%
  • Competitive advantage 45% 45%

*Source: Lloyds Bank, ‘Financial Institutions Sentiment Survey 2021’.

One of the most surprising areas of note in the report was the ranking of cyber resilience as a strategic priority for many firms. Even though the survey highlighted how firms have ‘become inherently more vulnerable to cyberattacks, with colleagues forced to work outside secure office networks’, they noted that it was “surprising” to find that, whilst growing numbers flag cybercrime as a significant risk in the 2021 survey, ‘fewer firms hold cyber resilience as a strategic priority (down from 34% to 29%)’.

The survey report cited research by BAE Systems Applied Intelligence which found three-quarters (74%) of banks and insurers saw a rise in cybercrime during the pandemic.

Recent reports form the Chartered Insurance Institute’s (CII)[2] have also highlighted the risks associated with cyber insurance knowledge gaps within firms.

The CII survey noted that almost six out of 10 insurance professionals stated they had not received any training about cyber risks even though they were involved with pricing or underwriting policies related to them, asserting that cyber insurance knowledge gaps could result in mis-selling and poor customer outcomes.

Nine out of 10 insurance professionals actively stated that they want to learn more about cyber risks through their training, highlighting that continual professional development of critical knowledge skills is needed to ensure employee knowledge stays ahead of evolving cyber risks.

Whilst almost all the respondents stated they wanted more training about emerging cyber risks, most of the training methodologies requested were in the form of ‘default’ training techniques such as online courses, webinars, self-election e-guides and single-point-in-time assessments.

With reports also suggesting that ‘if global multiline insurers fail to continually stay ahead of cyber trends then potential claims may no longer be insurable in extreme scenarios’ [3], prevention – through efficient training provisions – is now being championed as a crucial way for insurers to become more resilient to market risks.

With notable insurers – including Hiscox – leading a renewed charge on highlighting that ‘human error is still by far the biggest vulnerability when it comes to cyber attacks’ and that ‘staff forgetting the basics of their training’ continue to manifest increased cyber risks for insurers [4], firms should consider the shortcomings of these default training approaches, which may not provide the continual assessment methodology required to improve critical subject-knowledge retention and in-role application.

Find out more about the benefits of Clever Nelly

Spaced learning, repetition and self-testing, the principles behind our AI – Clever Nelly – have been cited as invaluable to the top five global general insurers we support including Allianz, RSA, Direct Line, AIG, and Aviva to help ensure their employees are knowledgeable and competent in critical subject material that relates to compliance, process, policy, and product.

Aviva PLC and Elephants Don’t Forget win coveted Gold Award at 2021 Brandon Hall Group HCM Excellence Awards in the category of Best Advance in Machine Learning and AI

Discover how it works…

Clever Nelly assesses and automatically repairs individual knowledge gaps cost-effectively and continually. It takes less than 1 minute 30 seconds of an employees’ day and engages with employees in the flow of work, with no disruption to BAU.

“Clever Nelly – Elephants Don’t Forget’s employee-centric AI tool – has been instrumental in reinforcing our renowned approach to individual employee learning to ensure that, post-training, we can continually embed key learning concepts and quantify the impact of learning on our KPIs to further support the exacting standards of customer service and in-role colleague support that we set for ourselves at Aviva PLC.”

-Joanne St. Bernard-Honegan Assistant Vice President, Talent Development at Aviva Canada


[1] Lloyds Bank, ‘Financial Institutions Sentiment Survey 2021’, available here:

[2] Chartered Insurance Institute, ‘Cyber Risk knowledge gap exposed by survey’, available here:

[3] Insurance Times, ‘Insurers must ‘increase their knowledge and expertise’ around cyber risks, available here:

[4] Insurance Times, ‘Cyber insurance ‘needs to evolve’ as it is ‘not the right product’ for the future – Hiscox’, available here:

Join the herd

Request a time to discover how Elephants Don't Forget can help transform your business today.