Duff & Phelps, the corporate finance advisory firm, has calculated that 89% of asset managers, brokers and banks believe that regulations are increasing costs, and most believe that compliance spending could more than double in five years.

The figures come from a recent survey whose results Duff & Phelps has been dribbling out to the public over the past two months in a successful effort to maximise press coverage. The survey of nearly 200 senior people in financial services shows that firms are typically spending 4% of their total revenue on compliance and suggests that this could rise to 10% of revenue by 2022.

Despite this, firms are struggling to comply with (and pay for) today’s financial regulation. For example, only 36% of firms that will be subject to MiFID II are confident that they are going to comply by 3rd January next year.

What is more, new regulations are increasing personal accountability for compliance staff across the globe and the way in which compliance departments allocate their budgets has been changing. These departments are now accounting in advance for the costs of hiring replacement compliance officers and other staff; for regulatory penalties and remediation; and for their staff members' own personal liability.

The need for tighter cybersecurity is another factor, with compliance spending in this area growing. Duff & Phelps believes, moreover, that firms are having to deal with skyrocketing cyber-costs by skimping on compliance with regulations in other areas and even predicts that some will miss the already-extended MiFID II deadline because of this. It also makes a slightly disturbing plea for regulators to dictate (by providing 'more guidance') the amounts of money that firms should spend on this and that.