The findings were disclosed in EY’s latest financial services M&A report, which showed that UK banks, insurers, and asset managers publicly disclosed 175 deals in the first half of this year, marking the highest volume in over a decade.
The total disclosed deal value for the UK BFSI (banking, financial services, and insurance) industry in H1 also grew year-on-year, increasing from £5 billion in H1 2023 to £6.9 billion in H1 2024.
Despite the increase in deal value, the number of UK banking deals decreased from 39 in H1 2023 to 34 in H1 2024. This decrease was reflected in an overall disclosed deal value increase from £3.2 billion in H1 2023 to £5.5 billion in H1 2024.
In contrast, the UK wealth and asset management industry saw a decline in the number of publicly disclosed deals, dropping from 66 in H1 2023 to 47 in H1 2024. The overall disclosed deal value more than halved from £1.5 billion in H1 2023 to £500 million in H1 2024.
EY’s report also found that the number of non-UK firms acquiring UK targets increased from 34 in H1 2023 to 48 in H1 2024, with the overall disclosed deal value rising from £200 million in H1 2023 to £1.3 billion in H1 2024.
Tom Groom, (pictured) UK Financial Services Strategy and Transactions Leader at EY, commented: “Signs of economic recovery in the UK have lifted market confidence, and the UK financial services industry recorded its highest half-year volume of M&A activity in over a decade.
“While short-term increases in deal volume and value are important to track, taking a longer-term view of activity is critical to understand the bigger picture.
“While deal volume has picked up so far this year – albeit at lower values on average – ongoing macroeconomic uncertainty, geopolitical tensions, and a change in government could create further headwinds.
“However, provided the economic outlook continues to improve, we anticipate M&A activity will increase – both in volume and value – further throughout 2024 as firms accelerate plans to innovate and grow in the strengthening environment,” Groom concluded.
