Mergers and Acquisition in Financial Services Sector, Q1 2017-Q1 2020 - Thematic Research
Summary
The main themes that drove M&A activity over this period across the banking, payments, and wealth management sectors were fintech, digital banking, digital payments, emerging economies, e-commerce, data analytics, and robo-advice. We expect these themes to continue to drive M&A in this industry as firms are forced to rapidly adapt their business models and user experiences to avoid being knocked out of the market by new digital competition. This drive to guard against disruptive technologies was never more evident than in 2019, when M&A deal values and volumes peaked. The pandemic has fundamentally shifted the way in which consumers purchase and access goods, giving more weight to contactless payments, online payments, and e-commerce. Banks will look to ensure that they get in on this market shift before it is dominated by disruptive players, and those that are cash-rich will look to acquire these disruptive firms.
In this report we highlight the most interesting M&A transactions across the banking, payments, and wealth management sectors announced from January 1, 2017 to March 31, 2020, and identify the themes driving these deals.
Scope
- M&A deal count has been trending down for the last two quarters, but has been broadly consistent over the last three years. Total deal value has been erratic and has generally remained at a higher level since its spike in Q1 2019.
- In Q1 2020 a total of 51 M&A deals with a transaction value of $50m or more were announced in global financial services sectors.
- These 51 deals had a combined transaction value of $88bn, which was down 28% when compared to the same quarter last year.
- Understand which themes are driving M&A deals in financial services.
- Identify the largest acquiring firms and where they are placing strategic bets.
- Review which start-up categories are generating the most acquisition interest.
- Explore which types of M&A are associated with different types of theme.
- Access GlobalData’s predictions on upcoming M&A deals.
- Executive Summary
- Thematic Drivers of M&A Strategy
- Running any business today requires an understanding of all disruptive threats
- Companies that invest in the right themes become success stories
- Table and those that miss the big themes transforming their industry landscape end up as failures
- Half of the top 20 M&A deals in 2019 were driven by tech themes
- COVID-19 Impact on M&A Activity
- In the short term, COVID-19 reduced M&A activity in the financial services sector
- In the medium term, the market correction could create attractive M&A opportunities
- Banking COVID-19 value chain impact
- Payments COVID-19 value chain impact
- Wealth management COVID-19 value chain impact
- M&A Deals in the Financial Services Sector: Q1 2017 –Q1 2020
- In 2019, M&A activity in the financial services sector rose by 151%
- M&A deals over Q1 2017–Q1 2020: Banking
- M&A deals over Q1 2017–Q1 2020: Payments
- M&A deals over Q1 2017–Q1 2020: Wealth management
- Future Acquisition Targets in the Financial Services Sector
- Our track record in predicting M&A targets is strong
- Our 2020 Theme map helps predict tomorrow's M&A targets
- Strategic thematic targets: Banking
- Strategic thematic targets: Payments
- Strategic thematic targets: Wealth management
- Deal Selection Methodology
- Glossary
- Our Thematic Research Methodology
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