The better the question. The better the answer. The better the world works. У вас есть вопрос? У нас есть ответ. Решая сложные задачи бизнеса, мы улучшаем мир. У вас є запитання? У нас є відповідь. Вирішуючи складні завдання бізнесу, ми змінюємо світ на краще. Meilleure la question, meilleure la réponse. Pour un monde meilleur. 問題越好。答案越好。商業世界越美好。 问题越好。答案越好。商业世界越美好。

Healthy outlook for deal activity

Global Capital Confidence Barometer | Banking & Capital Markets | 16th edition

Appetite for M&A and alliances should drive elevated dealmaking

Our 16th Global Capital Confidence Barometer indicates sustained optimism about the state of the economy among banking and capital markets (BCM) executives. We expect this confidence and market fundamentals to support strong dealmaking in the sector over the coming months.

Strong M&A fundamentals

Deal intentions are holding up, with 46% of BCM executives surveyed expecting to pursue acquisitions actively in the next 12 months —eight percentage points above trend. Almost all (92%) respondents see the global M&A market as either stable or improving over the next 12 months.

This active M&A market is underpinned by continued confidence in the number and quality of opportunities and the likelihood of closing acquisitions. With 85% of respondents believing that credit availability at the global level will improve or remain stable in 2017, capital market conditions also remain accommodating to dealmaking.

Higher valuations indicate a healthy market for M&A albeit with a focus on smaller, bolt on opportunities as 84% expect to do deals between US$250m and US$500m.

Ongoing disruption

As start-ups disrupt traditional business models, acquiring innovation will continue to be a major theme for the coming months. The next year is also expected to see more acquisitions aimed at enhancing and reorganizing current business models and platforms to counter increasing competition, to gain new customers and to extend product offerings. This trend has been reinforced by companies looking to combine with disruptive players or with companies from other sectors.

Outlook

With alliances and JVs now seen as equally important as M&A to BCM executives’ growth strategies, a key to success will be building a better ecosystem, not necessarily a bigger bank.

Read EY‘s Global Banking Outlook 2017 for more detail on why institutions must look for alternative ways to be organized and to operate.

EY - Charlie Alexander

Charlie Alexander

EY Global Banking & Capital Markets Leader

Transaction Advisory Services

+852 2629 3961


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