Trump's Return: A Deal-Making Bonanza for Investment Banks in 2025

As Donald Trump returns to the White House, investment banks are gearing up for a potential M&A boom in 2025. With his pro-business stance and likely deregulation, Trump's administration is expected to fuel a dealmaking revival, bolstering global investment banking income to $316 billion, a 5.7% increase from 2024. This resurgence is driven by pent-up demand from private equity and trade buyers across sectors like healthcare, tech, and energy.

The dealmaking rebound could be particularly conducive to cross-border dealmaking and investment from European firms chasing growth in the U.S. market. Richard King, head of corporate banking, EMEA, at Bank of America, anticipates a surge in pent-up demand from these players, driving M&A activity. Additionally, Trump's administration is seen as likely to wave through more deals that had been blocked previously over competition or U.S. strategic importance concerns, further driving M&A activity.



However, geopolitical risks remain a wildcard, potentially disrupting markets later in 2025. Banks will need to diversify their portfolios and reduce exposure to volatile regions, while strengthening risk management systems to monitor geopolitical developments. They may also increase investments in cybersecurity and digital infrastructure to protect against cyber threats.

The tech, healthcare, and energy sectors are expected to have the highest volume of M&A deals in 2025. Tech's growth is driven by AI, IoT, and cybersecurity needs, while healthcare's growth is fueled by aging populations and increasing demand for services. Energy's growth is propelled by the transition to renewable energy and a focus on sustainability. Trump's pro-business stance is expected to boost M&A, with his administration likely to wave through more deals.



In conclusion, as Trump returns to the White House, investment banks are eyeing a potential M&A boom in 2025. With pent-up demand from private equity and trade buyers, deregulation, and a focus on cross-border dealmaking, the stage is set for a dealmaking bonanza. However, banks must be mindful of geopolitical risks and ensure stable income growth in an uncertain global environment. The tech, healthcare, and energy sectors are poised for significant M&A activity, driven by specific factors and market trends. As investors, it is crucial to remain informed about these developments and make strategic decisions based on long-term company valuations.