UK Financial Services M&A Plummets to Nine‑Year Low in 2023

2023: A Wobbly Year for UK Financial Services M&A

Did you hear the news? The UK financial services sector logged 273 deals last year—down from 301 in 2022. That’s a drop of 9%, and the total deal value slipped from £14.9 bn to £12.1 bn, the lowest since 2014.

Why the Dip?

Banking crisis in March shook the market.
Interest rates have stayed high, lurking like a bad sequel.
Recession jitters and geopolitical drama keep investors on edge.
Many firms hit pause or reconsider M&A plans—think of it as a financial game of “Hold’em” where everyone is careful not to fold.

Tom Groom, EY’s UK Financial Services Strategy and Transactions Leader, summed it up: “Despite a promising start, the year was dominated by a challenging climate and investor caution.” He added that the sector is bracing for a slow start with a planned rebound in 2024 as interest rates are expected to ease.

Deal Breakdown by Sector

Banking Deals
- Number: 54 (down from 71)
- Publicly disclosed value: £6.7 bn (up from £4.3 bn)
Wealth & Asset Management
- Number: 107 (down from 132)
- Deal value: £2.1 bn (half of the £5.6 bn in 2022)
Insurance Deals
- Number: 112 (up from 98)
- Deal value: £3.3 bn (down from £5.1 bn)
Cross‑Border Movements
- Foreign buyers in the UK: 54 deals (down from 65)
  Value: £6.3 bn (down from £7.7 bn)
- UK buyers abroad: 66 deals (down from 69)
  Value: £1.7 bn (down from £3.2 bn)