B&CM M&A Outlook

Perspectives

2022 banking and capital markets M&A outlook

Explore the trends reshaping M&A in the banking sector

Banking and Capital Markets (B&CM) mergers and acquisitions (M&A) activity is firing on all cylinders after impressive increases in deal volume and value in 2021. Though the year ahead won’t be without headwinds, there are many reasons to engage in dealmaking in 2022. Learn about the banking M&A trends and drivers that are providing profitable opportunities, keeping the M&A growth engine humming.

A snapshot of banking and capital marketing M&A in 2021

After a tough 2020, banking M&A rebounded with 210 announced transactions as of December 31, 2021—an 89% increase from the prior year’s 111 deals—and an average deal value of $693 million, a healthy rise from 2020’s average $546 million. 2021 also had the largest number of transactions over $500 million in enterprise value since the financial crisis going back to 1998. And 2021 was a banner year for megadeals as banks sought scale, capabilities, business lines, and markets to compete against larger rivals. The five largest announced deals all topped the $5 billion mark.

Investment management (IM) and wealth management (WM) deal volume as of December 31 increased 50% year over year—316 deals versus 210 in 2020. Volume again skewed heavily to asset management and wealth management versus broker-dealer transactions. Compared with 2020’s megadeals, IM/WM transactions were smaller, accretive acquisitions by firms seeking greater scale in current markets or expanding into areas offering higher returns. This focus is reflected in 2021 average deal value, which fell from 2020’s record-setting high of $1.08 billion to a more modest $536 million.

2021 M&A activity—both among fintechs and between banks and fintechs—again trended upward. Deal value for US-based targets as of December 31 increased 12% year over year to $1.16 billion, compared to $1.03 billion in 2020; deal volume rose 31% year over year, from 164 to 216 transactions. Investor groups were responsible for 2021’s largest announced US-based fintech deals, with fintechs offering insurance and health care technology, security technology, financial media and data solutions, and human resources and payroll technology popular targets.

Read the full review of 2021 across banking, fintech, and IM and WM—and see the future of banking M&A—by downloading the banking and capital markets M&A outlook for 2022.

2022 banking and capital markets M&A outlook

What we expect to see for 2022

2022 banking and capital markets M&A trends and drivers

The following banking M&A trends and drivers are worth watching for their potential impact on headwinds or tailwinds during the coming year. Download the full outlook to explore all the important insights.

Keeping the banking M&A growth engine humming

B&CM M&A activity in 2021 has outstripped expectations, with volumes we haven’t seen in more than 20 years. There are numerous macroeconomic, strategic, and financial drivers to extend positive momentum into 2022 and keep the M&A growth engine humming.

Strategic buyers in 2022 may be challenged to find acquisitions that are attractive and accretive. It will be compulsory for the buyer’s management team to assess where the company is now, identify which capabilities it lacks in areas of rising demand versus peers and new entrants, and clearly articulate how M&A can enable it to compete and succeed in 2022 and beyond.

If you’d like to talk more about banking M&A activity and how your organization can succeed in 2022, let’s set up a conversation.

Look deeper

What are some other key trends, challenges, and opportunities that may affect your business and influence your strategy? Gain perspectives and insights from some of Deloitte’s other industry analyses.

Explore more industry outlooks.

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