Orc Software: Fear of Regulations Causes Freeze on Buying

Due to the uneasiness over pending regulations in the US, firms are sitting back and waiting to see what will come from the regulators and the Obama Administration, rather than spending to get ahead of the curve and target what they think they will need should the harshest of regulations be passed, says Martin Leamy, president of Americas for Orc Software.

"Investment firms are definitely holding off and I know for a fact that some of these firms have not hired people because they are not sure if they are going to have to spin off a certain business," he says. "How do I know that? We may have a firm that has 10 licenses of our software that says it is going [to increase that number] to 20, but then it decides to wait. Many of our customers like volatility so business is good. It's not like they are holding off because of the economy—it's the regulatory environment."

The greatest fear, he says, is that these regulations will make the market less competitive and that business will move to markets that aren't as strict. "It will move," he says. "There are all sorts of historical cases were that has happened."

"There are companies really holding off on doing certain things, especially US banks," Leamy adds. "It's not just the Volker rule—the whole regulatory story, there is a serious concern about it. Even though the Administration seems to be backing away from a number of these major provisions, there is a real concern out there."