Financial services M&A in the first half of 2026 was again marked by several high-value megadeals exceeding $5bn, but the overall volume and value of transactions globally declined, as macroeconomic and geopolitical volatility prompted greater caution among dealmakers.
We expect this uneven deals’ trajectory to continue for the rest of the year with megadeals generating the momentum. It is a pattern that has been increasingly discernible in the past several years in financial services and across the broader M&A markets as dealmakers are becoming more selective. For dealmakers, an important learning is that prepared buyers are pulling ahead. And some are willing to pursue larger deals than ever before, putting more conservative buyers—or those still in wait-and-see mode—at a growing disadvantage.
As we highlighted in our January 2026 deals outlook, the push for scale and cost efficiency to lift earnings and address increased competition (including from private credit) remain key M&A themes across all financial services segments. These pressures are not only spurring domestic consolidation but also leading to cross-border expansion. That includes US-based Nuveen’s proposed $12.9bn acquisition of UK wealth and asset manager Schroders, which is intended to accelerate growth and create one of the world’s largest global active asset managers.
The decline in deal values and volumes in part reflects the volatile macroeconomic and geopolitical environment, with growth slowing in many countries and inflation rising on the back of supply shortages related to the broader conflict in the Middle East. There are also some concerns about asset quality in loan portfolios.
‘Megadeals remain a defining feature of financial services M&A, expected to account for about half of the total deal value in 2026. Given a tougher geopolitical and macroeconomic environment, dealmakers are increasingly selective, while continuing to pursue scale and tech-driven transformation.’
Christopher Sur,Global Financial Services Deals Leader, PwC GermanyThe picture is not monolithic across all segments or geographies. Many of the largest deals in the first half of 2026 have involved asset and wealth managers, with the US and the UK among the most active M&A markets. In asset management, merger activity among mid-tier firms continues to be driven by the need to improve efficiency, expand distribution, and enhance access to private markets, even as overall deal volumes remain muted.
In the other two segments, banking and capital markets and insurance, the pressures to consolidate have not dissipated, but deal volume has been lower in the first months of the year. In banking, for example, 2026 has not yet seen the same level of regional consolidation in the US and Europe than 2025, although at the time of writing, two Italian banks are bidding for Italy’s Monte dei Paschi di Siena.
Notable megadeals in the first half of 2026 included Banco Santander’s $12.2bn acquisition of US commercial bank Webster Financial Corporation and Zurich Insurance Group’s $10.9bn acquisition of British property and casualty insurance carrier Beazley.
Another large-scale financial services deal spanning the insurance and asset management sectors was the March 2026 merger between Corebridge Financial and Equitable Holdings, a combination of two scaled retirement, life, wealth, and asset management platforms with approximately $1.5tn in assets under management and administration. Their proposed $22bn merger represents one of the largest strategic combinations in the life and retirement insurance sector in recent years.
Spotlight on private credit Private credit faces its first real test
In our January 2026 M&A outlook, our spotlight focused on the growing importance of private credit and its expanding role in M&A. With more than $2tn in assets under management, private credit has become a major force in global capital markets. Its rapid growth represents a potentially generational shift—one we believe will continue to create unique deal opportunities.
That growth is now being tested. Certain high-profile restructurings and bankruptcies in late 2025 put a spotlight on private credit’s reach and raised questions about borrower defaults, credit risk, transparency, and potential losses. These concerns intensified in 2026 as pressure on software valuations and questions about AI’s impact on software revenue models exposed concentration risk in parts of the market. Some funds faced higher redemption requests. Others capped withdrawals, reinforcing investor concerns about the illiquid nature of the asset class.
This does not mean private credit is in crisis. It does mean that the asset class is facing its first real test at scale.
Regulators in the UK, the US, and Europe are paying closer attention, particularly around opacity, liquidity risk, and potential spillover effects across the financial system. Negative headlines have added to the pressure, but the underlying question is more important. Can private credit keep scaling while maintaining discipline around underwriting, valuation, governance, and investor expectations?
To gauge market sentiment and project forward, PwC recently conducted a global private credit survey of more than 120 credit portfolio managers. Respondents remained positive about future growth, with more than 80% expecting increased allocations to private credit over the next 12 months. At the same time, their responses suggest private credit is at an inflection point, with the next stage of growth likely to depend more on how well managers navigate stress.
Portfolio managers expect that borrower defaults and credit losses will affect performance in 2026, although only 16% said they were concerned or very concerned about an increase in private-credit-related defaults and restructurings over the next two years. This suggests the market is not signalling a broad loss of confidence. But priorities are changing. In a flatter return environment, portfolio managers are placing greater emphasis on investment selection, performance, governance, and downside protection.
The implications for M&A are significant. Private credit is disrupting traditional market norms and accelerating convergence across financial services. In the US and Europe, a growing share of banking and capital markets transactions is being funded by alternative credit funds. That shift is influencing deal rationale, expanding buyer universes, and changing transaction structures.
The PwC survey findings suggest that private credit will remain an important and growing part of the deals landscape, despite recent setbacks. We see several ways this will continue to play out, including:
- Direct lending in M&A situations, both in the mid-market and for larger-capitalisation companies
- Credit funds becoming M&A targets as scaled asset managers and private capital firms look to add origination capability and deepen their credit platforms
- Insurers expanding allocations to credit funds or acquiring their own credit asset management capabilities (this approach enables them to deploy their balance sheets more directly while also raising third-party capital from limited partners)
- Private credit funds partnering with banks to provide customers with structured finance solutions, recognising that collaboration can offer a faster and more efficient route to market
Global M&A volumes and values in 2026
Global financial services M&A activity declined in the early months of 2026 as momentum from 2025 slowed and macroeconomic and geopolitical volatility prompted greater caution among dealmakers. Deal value also declined, but less sharply than volume, supported in part by seven megadeals announced during the first five months of the year. This matched the number of megadeals announced in the same period in 2025, although it is below the pace implied by the 21 megadeals recorded for full-year 2025. Of the seven megadeals announced through May 2026, four were in banking and capital markets, two were in asset and wealth management, and one was in insurance.
By region, deal values in Europe, the Middle East, and Africa were supported by three megadeals—two in the UK and one in Germany. The Americas also recorded three megadeals, all in the US, while Asia Pacific recorded one megadeal in Japan.
Deal activity declined across all regions, underscoring a more selective market in which strategic conviction, capital availability, and execution readiness are becoming increasingly important.
Global M&A trends in financial services sectors
Here, we look at trends driving M&A activity across banking and capital markets, the insurance sector, and asset and wealth management in the second half of 2026.
M&A outlook for financial services in the second half of 2026
We expect the large deal-driven momentum in financial services M&A to continue throughout 2026 as banks, insurers, and asset managers navigate an increasingly competitive and complex operating environment. Much will depend on external factors such as the trajectory of interest rates and the outcome of ongoing conflicts.
At the same time, long-standing pressures around capital efficiency, technology- and AI-related investments, and resilience are intensifying, reinforcing the need to reshape portfolios, sharpen strategic focus, and build scale in a cost-effective way.