UK Banks Are Set for More Consolidation, JPMorgan Analyst Says

Larger UK banks are likely to go into acquisition mode as they benefit from expanding deposit margins, with smaller rivals looking like attractive targets, according to analysts at JPMorgan Chase & Co.

“Consolidation is the natural path given the trajectory of margins,” analysts led by Sheel Shah wrote in a note, highlighting NatWest Group Plc and HSBC Holdings Plc as best positioned for the trend, given their inorganic growth ambitions. On the flip side, the mortgage portfolios of Metro Bank Holdings Plc and Bank of Ireland Group Plc are potentially attractive, along with challenger banks, they said.