European Financial Services M&A news and views

This quarterly report aims to provide perspectives on the recent trends and future developments in the European FS M&A market.
December 2011

Deal values were subdued in the third quarter of 2011, reflecting market uncertainty and volatility. Yet, if anything the sovereign debt concerns, and a further round of bank recapitalisation this has engendered, underline the rationale for continued bank restructuring. Banks will be expected to reach a 9% Tier 1 capital ratio by June 2012, with the European Banking Authority (EBA) estimating that banks will need to make up a shortfall of €106bn to reach this target.

Many banks will be actively looking to divest non-core and capital intensive assets as they seek to further stabilise their businesses and concentrate resources on fewer, stronger sources of value. As we examine in this issue, the divestments are likely to include nonbanking operations such as securities and asset management. They are also likely to include smaller foreign operations, creating acquisition opportunities for both domestic and international competitors.

Key message sections within the report

  • Banks’ need to restructure
  • Banks are increasingly keen to divest foreign subsidiaries
  • M&A is becoming a more urgent goal for many asset managers
  • Negative impact of the Eurozone crisis stems from intangible factors
  • Market disruption is contributing to a number of M&A hurdles
  • What now?
  • Can the  European crisis be resolved?

For the previous issues, click here