A new analysis of the United Kingdom (UK) financial services sector conducted by EY Financial Services reveals that in the first half of 2026, M&A transactions rose significantly, with a 25% year-on-year increase in announced or completed deals, marking an eightfold increase in deal value.
In H1’26, total disclosed value for UK financial services deals rose to £33.7 billion, compared to £ 4.2 billion in H1’25, with seven deals exceeding £1 billion in value.
There were two megadeals between £8-10 billion, representing approximately 93% of total deal value, up from two deals above £1 billion in H1’25.
Additionally, UK banks, insurers and asset managers publicly disclosed 135 transactions in H1’26, compared to 108 deals last year.
The EY report said, “Over the past decade, dealmaking in the UK’s financial services sector has fluctuated annually, with overall volume trending up. H1 deal volumes are now 93% higher than they were in 2017 (70 total deals reported) and deal value has more than doubled (from £10.1bn in 2017).”
Enhancing technology or artificial intelligence (AI) capabilities is a top priority for most of these transactions, with a quarter of participants ranking it ahead of strategic fit with long-term growth priorities and return on invested capital.
While deal volume, at 141 recorded deals, was slightly lower than during H2’25, disclosed deal value rose from £27.9 billion to £33.7 billion in H1’26, with momentum expected to build further in H2’26.
According to the latest EY CEO Outlook for UK financial services, 95% of UK financial services CEOs expect their organisation’s appetite for M&A to increase in 2026 compared to 2025.
Taking a look at figures, UK wealth and asset management deals rose from 47 in H1’25 to 61 this year, with deal value increasing significantly from £0.2 billion to £22.7 billion.
Insurance deals rose from 40 to 55 in H1’26, with value rising significantly from £1.6 billion to £8.4 billion in the period.
Deals in the banking and capital declined slightly from 21 in H1’25 to 19 in H1’26, as value increased slightly from £2.4 billion last year to £2.5 billion in H1’26.
The number of non-UK firms acquiring UK targets fell from 40 in H1’25 to 36 this year, while the total disclosed deal value rose from £4.1 billion in H1’25 to £27.2 billion in H1’26.
Meanwhile, UK firms acquiring overseas targets fell from 37 in H1’25 to 34 now, as value increased from £0.6 billion in H1’25 to £2.6 billion in H1’26.
Damian Hourquebie, Financial Services Strategy and Transactions Leader, EY UK, commented, “It’s been a strong first half for UK financial services dealmaking, with overall transaction value significantly higher compared to last year, and more than double what it was a decade ago. Market confidence has been supportive, with continued focus on strategic consolidation to bolster revenue growth, innovation, and transformation.
“While geopolitical and economic uncertainty remains, the strength of activity across H2 2025 and H1 2026, alongside the prioritisation of tech and capability-led M&A, suggests UK financial services leaders are making bold, strategic decisions to support sustained growth amid market challenges.”
Ari Constantinou, Financial Services Transformation Leader, EY UK, added, “Wealth and asset management continues to stand out as one of the most active areas of high-value M&A in UK financial services, with investors drawn to the sector’s long-term growth potential and opportunities to expand.
“While scale remains a key driver for deals, we are seeing more firms use M&A to accelerate business transformation – expanding advice capabilities, strengthening private market offerings, reaching new client segments, and enhancing digital investment capabilities. In this environment, M&A is increasingly being used not just to grow bigger, but to transform faster.”
