The editor examines some of the considerations and issues linked to two large corporate deals in wealth and asset management this week.

The merger and acquisition merry-go-round continues to spin, and this week has seen two of the largest such deals affecting the UK in years – NatWest’s purchase of Evelyn Partners and yesterday’s announcement by US-based Nuveen that it has agreed to acquire Schroders. 

The familiar reasons for these corporate marriages are in play: a drive for economies of scale as tech, regulatory, human resources and business development costs mount; a desire to win fresh market share, capture intergenerational wealth transfer and tap into fresh wealth creation.

And the same reasons for caution arise: can these firms integrate smoothly? What potential staff and client attrition might there be? Will famous brands be retained, or fade? Are the return expectations, when set against purchase prices, realistic? Where does all this leave notions of independence if a standalone wealth manager like Evelyn Partners is now part of a listed “big four” UK bank (NatWest), and so on? (As an aside, NatWest announced its figures for Q4 2025 today.) 

As many readers know, several banks were said to be seeking Evelyn’s fair hand – Barclays and Royal Bank of Canada were named as suitors. Barclays – which reported solid results this week – lost out on this occasion, but it may be looking around for targets to avoid being left out. That it was involved in a bidding race suggests that it thinks it has resources to do so. RBC, it should be said, bought the Brewin Dolphin business a few years ago.

There is such a thing as “fear of missing out” here. In early 2024, Barclays restructured into five operating divisions, including Barclays Private Bank and Wealth Management. And that year, it began to report on how this area is doing financially, having spent several years not releasing such figures. This suggests that it sees wealth management as increasingly important. On the conference circuit this week, a few names of potential purchase candidates came around. We will keep an eye on what Barclays may be up to.

The underlying mood of the UK wealth sector appears to be that, for all the concerns about weak domestic economic growth and unsettled politics, it paradoxically galvanises people to seek advice. Schroders, for example, has worked on building out its capabilities with its work with advisors – as we reported here – and Evelyn Partners stresses this among its skillsets. Schroders has also ramped up areas such as real estate and alternative investment, which typically earn larger fees than from long-only stock and bond portfolios.

Another theme that came out, particularly on the NatWest/Evelyn side, is that wealth management will make up about 20 per cent of total group assets and liabilities – diversifying from revenues such as on net interest income. Investors may come to appreciate that.

On the Nuveen front, I know from past conversations that this business, part of TIAA – Teachers Insurance and Annuity Association of America, to give its full name – has been expanding into the wealth management space, as broadly defined. Acquiring a venerable name with a strong brand, and reach into regions including Asia, is a good move.

The Schroders deal had its own quirks. For a start, the Schroder family dynasty owned 41 per cent of the shares and had controlling rights. As part of this, it sat on a heavy cash pile. The multiple that Nuveen paid to buy Schroders, set against the latter firm’s earnings before interest, taxation, depreciation and amortisation, was 8x EBITDA, whereas NatWest had to shell out about 15x. After tax, the purchase price for Schroders is around 17x.

While these moves were going on, shares in some US management/brokerages such as Charles Schwab and LPL Financial have fallen sharply (Schwab was down more than 8 per cent on the five days up to the Wednesday close; LPL was down by 12 per cent). In the UK, St James’s Place has slumped by 14 per cent; A J Bell is down by 4 per cent and Quilter down 0.2 per cent as of the same time period. It seems that investors fear that some parts of the wealth management value chain could be taken out by AI, undermining the value of some brands.

I asked the UK’s wealth management business association, PIMFA, what it made of the AI-induced concerns.

‘Whilst we understand market excitement that accompanies the launch of innovative new tools, and would expect there to be an obvious reaction to the perceived value of services these tools notionally compete with, we would caution against early predictions that the launch of a planning tool is a portent for ‘the next AI casualty’; especially given that we are still waiting for the first,” Simon Harrington, head of public affairs, told this publication. 

‘Whilst we certainly wouldn’t want to tell investment analysts how to think, it is disappointing that they apparently place little value in the role of financial planning and human advice,” he continued. “We do not see AI planning services as an existential threat to the wealth management industry; we see them as complementary. These tools, which many firms already use in some form, will ultimately allow firms to unlock capacity by automating processes that currently rely on human capital. This will allow them more time to spend with the people who matter most in this process: their clients.”

That seems a wise response. Investors in the US and certain other markets are certainly in a febrile mood. It may be that such fears are overblown. But even if some of the AI disruption angst is exaggerated, in such an environment, the pressure to achieve scale if margins are squeezed will only become more intense.