Can Scotland lure more financial services firms?

With the majority of incumbent financial services firms looking to make cuts, it seems that the powers that be are relying on a raft of new entrants to put the industry back on track.

It's no secret that Scottish politicians have been visiting distant lands in an attempt to lure new investment this year, but so far reasons for celebration have been few. BNP Paribas is still expanding north of the border, and esure is creating 500 call centre roles. Similarly, Virgin Bank says it's establishing 100 jobs in Scotland.

But while he wouldn't be drawn on specifics, Mark McCullen financial services manager for Scottish Development International, told TalentScotland magazine that there was a "strong pipeline" of firms interested in setting up north of the border.

This could, off course, simply be a case of drumming up some positive PR for the sector. But Mark Tennant, senior adviser to JPMorgan and the incoming Scottish Financial Enterprise chairman, says that it's integral to "engage with the critical players" and "take every opportunity to explain and promote Scotland's strengths".

Essentially, they're talking about the (slight) cost benefits of locating a number of back office functions in Scotland, an area in which the country has significant expertise to tap into and which could provide a significant volume of new jobs.

But Dougie Adams, an adviser to the Ernst & Young Scottish Item Club says that Scotland is by no means guaranteed to attract more of these firms.

"Firms could close office A and keep office B open, which could benefit Scotland or see more job losses. Employees here are skilled, and marginally cheaper than other areas of the UK, but office space is expensive, and these roles could be offshored anyway," he says.

Of course, at the moment this is still mainly talk. However, predictions more grounded in reality are those around Tesco Personal Finance, which seems to be ever-expanding north of the border.

Now, it's tipped to base its insurance operations in Glasgow, which could result in the creation of some 800 jobs.