Growth in IT spending by banks and investment firms is flat from 2006, despite a positive industry outlook. IT groups are focusing on improving efficiency through investment in productivity tools and infrastructure, while continuing to take a cautious look at outsourcing. Hampered by the cost of keeping the lights on and increased security needs, financial firms aren't investing the needed dollars in research and development (R&D) to find new ways to grow revenue. Without a focus on innovation and transformation, these firms will not be up to meeting new competitive and consumer pressures.