Financial Institutions Group Q2 2025

Executive Summary

M&A activity in the Banking, Finance, and Insurance sector maintained steady momentum in Q2 2025, with 765 closed transactions (LTM), up from 693 in Q2 2024. While deal volume remains below the highs of 2022, the market reflects stability amid ongoing economic and regulatory shifts. Strategic buyers dominated, accounting for 98% of transactions, while financial buyers showed selective interest in niche financial services. Valuations were relatively stable, with median TEV/EBITDA at 10.44x and TEV/Revenue at 1.39x, signaling cautious confidence and an emphasis on scale, technology integration, and cost efficiency.

Market Dynamics

Valuation pressures persisted in Q2 2025 as Banking, Finance, and Insurance buyers navigated elevated interest rates and regulatory headwinds. Revenue multiples edged up slightly to 1.39x, while EBITDA multiples held steady at 10.44x. Premium valuations were concentrated among targets with strong regional footprints, technology-enabled platforms, or essential roles in financial ecosystems, reflecting buyer focus on operational resilience and scalability.

Buyer Landscape

Strategic Acquirers: Strategic buyers dominated the market, accounting for 98% of transactions (747 of 765). Activity focused on regional bank consolidations and acquisitions of insurance brokerages to expand geographic reach and service capabilities.

Financial Buyers: Financial buyers represented 2% of deal volume, selectively targeting niche financial services and fintech platforms. Private equity interest remained steady in scalable businesses with technology integration and recurring revenue models.

Industry Comparison

US banking and financial services M&A experienced a 19% increase in deal value in H1 2025, reaching $224 billion, with Q2 alone hitting $123 billion, the strongest quarter since Q3 2022. Deal volume, however, fell ~17% YoY, indicating fewer but larger transactions.^{1 2}

Geographic Expansion

Top U.S. States: California led with 68 transactions, followed by Texas (63) and Florida (40), underscoring the concentration of financial institutions and fintech hubs in these states.

Cross-Border Trends: U.S.-based targets remained the majority, though select inbound interest from international buyers points to ongoing global demand for U.S. banking and insurance assets.

Notable Transactions

Largest Transactions Closed

Other Strategic Buyer Transactions Closed

Other Financial Buyer Transactions Closed

Emerging Trends

Key trends shaping Financial Services Firms & Banks:

1. Investment Banks Expand Private Credit for Insurance M&A
   With traditional bank lending more cautious, private credit funds backed by major investment banks increased financing for insurance sector acquisitions, helping fuel deal activity and enabling larger transactions.³
2. Insurtech Startups Drive Targeted Acquisitions
   Insurance companies increasingly acquired insurtech startups specializing in claims automation and customer engagement platforms, accelerating digital transformation and operational efficiency.⁴
3. Rising Focus on Cyber Risk Insurance Consolidation
   The cyber insurance subsector saw heightened M&A activity as carriers consolidated to address growing demand and risk complexities, with PE firms backing platforms to build scale and underwriting expertise.⁵
4. Subsector Spotlight: Regional & Community Banks
   With enhanced regulatory clarity and high-tech investment needs, smaller banks are becoming acquisition targets—while larger peers pursue scale and cost synergies.⁶
5. Subsector Spotlight: Payments & Wealth
   Financial institutions increasingly pursued digital payments and wealth managers with rich fintech integrations—primarily for fraud prevention and advisory scalability.⁷

Outlook for Next Quarter

Opportunities: The demand for AI-augmented risk systems, ESG-integrated insurance solutions, and embedded finance platforms is expected to fuel deal activity.⁸

Risks: Wage inflation and evolving Basel III regulations could constrain bank M&A, especially for institutions with capital limitations.⁸

Predicted Activity: Insurance broker consolidation remains strong, driven by PE and strategic buyers with focus on scale and recurring revenue.⁸

PCE Transactions

Served as advisor to Nuview Trust on their sale to Millenium Trust Company

Served as advisor to Florida Marketing Organization on their partnership with Baldwin Risk Partners

Served as advisor to Family Financial for equity financing.

Served as advisor to Perkins Sate Bank on their acquisition of Nature Coast Insurance.

Served as advisor to Ron Sellers & Associates as they merged with Kuykendall Insurance Group to form Sellers Kuykendall

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