European M&A activity reached a nine-year high in 2024

In 2024, the European financial services industry experienced a resurgence in mergers and acquisitions (M&A) deals following a relatively slow year in 2023. According to the latest financial services M&A analysis by EY, there was a notable 22% year-on-year increase in the number of deals in 2024. European banks, insurers, and asset managers publicly disclosed a total of 784 deals across the region, marking the highest annual volume since 2015, compared to 643 deals in 2023.

Moreover, the total disclosed deal value saw a significant rise from €36.3 billion in 2023 to €52.0 billion in 2024. Notably, there were 10 deals valued above €1 billion last year, highlighting the scale and impact of these transactions in the industry. The upswing in M&A activity was most pronounced in the second half of 2024, with 415 deals announced – the highest volume for that period since 2012 and a remarkable 58% year-on-year increase from the previous year.

Reflecting on these developments, Benoit Gérard, EY EMEIA Financial Services Strategy and Transactions Leader, pointed out that the recovery of the European economy last year played a crucial role in boosting market confidence and facilitating stronger deal-making within the sector. The decline in inflation and interest rates across Europe’s major economies in the second half of 2024 contributed to an overall increase in both deal volume and values, driving consolidation and strategic transactions across the financial services landscape.

Looking ahead to the future, Gérard anticipates a further increase in M&A activity as market optimism, albeit cautious, gains momentum. With private equity investments on the rise and a growing appetite for strategic transformation, firms and investors are expected to leverage M&A as a tool to accelerate growth in a competitive market environment. However, he emphasizes the importance of remaining vigilant in light of evolving global geopolitics and macro-economic conditions, factors that could influence the trajectory of M&A activities in the coming months.

When examining sector-specific M&A trends within Europe’s financial markets, several key insights emerge. The number of banking deals increased from 195 in 2023 to 213 in 2024, though the total disclosed deal value experienced a slight decline. In the insurance sector, both the number of deals and total disclosed value saw significant growth, with 333 deals and €13.2 billion in value in 2024, up from 241 deals and €9.8 billion in 2023. Similarly, wealth and asset management experienced a notable increase in both deal volume and value, indicating robust activity and strategic investments in this space.

Furthermore, the data revealed a rise in non-European firms acquiring European targets, with 109 deals in 2024 compared to 82 in 2023. However, the total disclosed deal value for these transactions decreased slightly year-on-year. On the other hand, European firms acquiring targets from other markets also increased, with 64 deals in 2024 compared to 46 in 2023, reflecting a rise in cross-border investments and strategic partnerships within the financial services sector.