According to a new survey, banks and other financial firms in the UK are at their most optimistic level in about 17 years as the economy shows signs of recovery.

The latest quarterly CBI/PwC financial services survey released on Monday showed that around 59 per cent of all UK financial services firms are more optimistic about business situation compared to 6 per cent who were less optimistic. The positive balance of 53 is the highest recorded since December 1996. The survey was conducted between three months to early September in the UK.

The survey also showed that 14 per cent of the firms are expecting to increase staff during the quarter, indicating that the UK's jobs market might be stabilising. The CBI/PwC survey is based on the difference between firms recording an increase and those reporting a decrease. It was found that about 10,000 jobs were added in the third quarter and another 2,000 will be created this quarter, which will take the total number of UK financial services jobs to 1.14 million in the UK.

"Banks' optimism is increasingly buoyant despite seeing a slight seasonal blip in commercial and industrial volumes. Activity and profitability are expected to grow as the economy recovers, and investment in new products and infrastructure is increasing," said Kevin Burrowes, PwC's UK financial services leader.