Is it going to be a good year? The respondents in TD Bank's fourth annual CFO Survey feel that way.
Nearly 60 percent were either much more optimistic (7 percent) or somewhat more optimistic (52 percent) about growth in the U.S. economy this year — a jump of 13 percent from a year ago.
Here’s the better news: A large segment said they are interested in spending money in some key areas, including technology (64 percent), facilities upgrades (42 percent) and hiring (40 percent).
“The increased appetite for capital investments confirms our view that businesses are finding ways to thrive in the ‘new normal’ economy,” TD Bank Executive Vice President and Head of Corporate & Specialty Banking Greg Braca said.
“Increased spending at the corporate level bodes well for the long-term acceleration of growth and M&A, with companies recognizing that now is a great time to make a move before interest rates creep higher.”
A strong majority of executives (81 percent) also are expecting their company’s revenues to increase.
The picture isn’t all rosy.
Most companies said they still plan to hold on to the cash they have on the sidelines and some are still concerned over governmental issues they feel are holding them back. Governmental regulation was cited by 22 percent of respondents as a problem, while 15 percent felt government gridlock over the deficit and tax policies was an issue.
“While there's still unease about the business environment, CFOs are much less concerned than they were even just a few years ago,” TD Bank Executive Vice President and Head of Regional Commercial Banking Fred Graziano said.
“Only the competitive environment was viewed with increased concern over 2013, but that's a good thing. Competition exists because the overall business climate has improved, which the Fed has confirmed by seeking to raise interest rates sooner than initially expected.”
According to the company, TD Bank polled senior finance executives, including CFOs, comptrollers, treasurers and directors of finance, across the East Coast to understand their companies' current financial health, as well as their thoughts on the overall economy and their future business plans and expectations.
The survey was conducted in March and April 2014 by ORC International, and surveyed a total of 300 executives, three-quarters of respondents at companies with annual sales of $50 million to less than $250 million (middle market) and a quarter at companies with annual sales greater than $250 million (corporate).
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