A report by the Chartered Institute of Credit Management (CICM) has shown that business confidence continues to fall within the manufacturing sector following Brexit, according to the latest Credit Managers’ Index. The quarter index however, showed that confidence within the Services sector has slightly improved and rallied after a poor first quarter, arresting the decline of the index overall. The headline index (including both Manufacturing and Services) stood at 56.1 – a fall of 0.5 points on the previous quarter. Manufacturing fell by 1.8 to 57.2 whereas Services improved by 0.06 to 55.63.
Philip King, Chief Executive of the CICM, stated: “It will be interesting to see what effect the Bank of England’s cut in the base interest rate to 0.25% and further quantitative easing will have on this volatility and confidence.” With post-Brexit volatility comes the potential for concern about credit ratings. A fifth of credit managers said they would not allow a ‘risky subsidiary credit rating’ to be trumped by the parent company, though a further 18% said if a parent company risk profile was strong they would consider this. Only a third of companies had a clear process for making these decisions, underlining the need to review and update processes for this area so that they are not exposed to undue risk. Times may be challenging in some sectors but credit managers are still looking to ensure they get the support needed to help them do a better job and advance their skills. 64% of credit managers said they were getting this from their employers, but over a quarter (28%) believe they do not get the support and resources needed to improve their knowledge.